Bearish view
- Sell the BTC/USD pair and set a take-profit at 85,000.
- Add a stop-loss at 95,000.
- Timeline: 1-2 days.
Bullish view
- Buy the BTC/USD pair and set a take-profit at 95,000.
- Add a stop-loss at 85,000.
The BTC/USD pair held steady above 90,000 on Tuesday morning as the recent comeback continue ahead of the Federal Reserve interest rate cut. Bitcoin price was trading at $90,300, and has formed some bearish patterns pointing to more downside.
Bitcoin Price Steady Ahead of Fed Decision
The BTC/USD pair has remained in a tight range in the past few days as traders waited for the upcoming Fed decision. Economists are optimistic that the Fed will cut interest rates by 0.25%, with odds of cuts rising to 95% on Polymarket.
In theory, the cut should be bullish for Bitcoin and other risky assets like the stock market. However, there are signs that the bond market is fighting back, with bond yields continuing their uptick. The 10-year and 5-year bond yields have been in an uptrend and is hovering near its highest point in weeks.
Bitcoin price also jumped after Strategy made one of its biggest purchases this month. The company spent $963 million to acquire 10,624 coins. These purchases were financed by a 5.1 million share sale worth about $928 million. It also sold perpetual strife preferred stock worth over $34.9 million.
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The Bitcoin purchases came two weeks after the company made headlines by noting that it may consider selling some of its coins to fund its dividend and debt. It then clarified that it had over $1.2 billion in cash to make these payments.
BTC/USD Technicals Suggest a Bearish Breakout is Near
The daily timeframe chart shows that the BTC/USD pair has been in a downtrend in the past few months. It has dropped from the year-to-date high of 126,300 to a low of 80,637.
Technicals suggest that the pair has more downside to go. For example, the pair formed a death cross pattern on November 16 as the 50-day and 200-day moving averages crossed each other.
Most notably, the pair is in the process of forming a bearish flag pattern, which is made up of a vertical line and an ascending channel. The Relative Strength Index (RSI) has stalled below the neutral point at 50.
Therefore, the most likely BTC/USD forecast is bearish, with the next key target being at 85,000. A bullish breakout will be confirmed if it moves above the 50-day moving average at 97,155.
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