Major indicators are signalling upside price action for Bitcoin. In spite of this the market remains slightly depressed as US and global economic uncertainty persists.
The market is waiting for the FOMC meeting
The US economy was given a bit of a filip recently when nonfarm payrolls increased by 177K in April, instead of the 133K that were forecast. However, this is only likely to strengthen Fed Chairman Jerome Powell’s hand on Wednesday at the FOMC meeting for keeping interest rates at their current level.
No interest rate cuts mean that borrowing cannot get cheaper and so businesses have to continue curbing their growth, possibly leading to more economic stagnation.
The market is definitely expecting no change in interest rates, but of course, every single utterance by Jerome Powell in his speech will be dissected for any ulterior meanings, and the Fed chairman will be careful to stick to a particular tone that could be hawkish or dovish, depending on which way the Fed wants the market to lean towards.
With this in mind, it could be the reason why there’s still not much going on in the shape of positive price action for Bitcoin. Money is being clutched tightly to chests, perhaps until after the FOMC meeting, but this is in the face of technical indicators signalling that a rally should be getting into its stride.
Nevertheless, one can’t have a decent rally without plenty of investor money and confidence to back it. This is probably still in the pipeline, but perhaps we need to get Wednesday out of the way first.
Decision point about to be reached
Source: TradingView
The short-term time frame for $BTC shows that volume is decreasing. This could be that the market is waiting for a catalyst, which could come in the form of the FOMC meeting on Wednesday. It can also mean that sellers are becoming exhausted and that a reversal back to the upside may not be far away.
It’s difficult to define the actual chart pattern that the $BTC price is following. However, the price action is funnelling into the apex of two converging trend lines right now, and so $BTC should emerge from one side or the other. Of course, the price could just push through the top trendline and then continue limping sideways.
The Stochastic RSI at the bottom of the chart is starting to cross back down, and this would then perhaps favour a drop through the bottom trendline. A price decrease below $93,000 would need to be avoided by the bulls in order to prevent a lower low from occurring.
$BTC trend is still up
Source: TradingView
Meanwhile, in the higher time frame of the weekly chart, all is looking very positive still. The current price is holding support. Given the amount of strong resistance here, it was only to be expected that there would be a pause in this area as the bears defended this level.
Three indicators at the bottom of the chart all show that the $BTC price could continue to go up. The Stochastic RSI has its indicators passing the middle line, the RSI is still displaying a cross up, and the MACD at the bottom of the chart shows the indicator lines posturing to cross back up, and the histogram about to turn back to the green.
The trend is most definitely still up, and it’s probably just a matter of time before the bulls return with a vengeance. The next point of contention is likely to be just how far can this bull market go?
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.