Bullish View
Buy the BTC/USD and add a take-profit at 52,000.
Add a stop-loss at 47,000.
Timeline: 1-2 days.
Bearish View
Set a sell-stop at 48,000 and a take-profit at 46,000.
Add a stop-loss at 49,000.
The BTC/USD pair has risen in the past three straight days as demand slowly returns. It is trading at 49,000, which is higher than this week’s low of about 47,000.
Tightening Federal Reserve
The BTC/USD pair has jumped sharply during the Covid-19 pandemic. During this time, most analysts have credited the Federal Reserve as the main reason for the performance. The bank has slashed interest rates to zero and launched a massive quantitative easing policy that has devalued the US dollar.
The era of ultra-low rates is coming to an end after this week’s interest rate decision. On Wednesday, the bank decided to leave interest rates unchanged in a bid to support the country’s recovery. At the same time, the bank hinted that it will hike interest rates three times in the coming year.
The bank also intervened on its quantitative easing program. It decided to double the amount of tapering to about $30 billion. Therefore, the Fed expects that the program will end in March next year.
In theory, a tightening Fed is usually negative for the BTC/USD price. Still, the pair rose simply because the hawkish nature of the Fed was highly anticipated and is the main reason why Bitcoin has retreated in the past few weeks.
Bitcoin has also gained because of the overall positive nature of the blockchain industry. In the past few weeks, several major deals have been made, signalling that investors are optimistic about the industry. For example, this week, FTX announced that it will become a sponsor of Golden State Warriors, one of the leading teams in the US.
On Wednesday, it was also reported that Anchorage had raised $350 million at a $3 billion valuation. Anchorage is a crypto company for institutional investors. NYDIG also raised $1 billion from investors, becoming the biggest VC deal of the year. Another company, Ramp, raised more than $50 million. It is often seen as the PayPal for cryptocurrencies.
BTC/USD Forecast
A closer look at the four-hour chart shows that the pair has found a substantial support level at around 46,500 in the past few days. It has struggled to move below this level severally. At the same time, the pair is oscillating slightly above the 25-day and 50-day moving average while the MACD is attempting to move above the neutral level.
Therefore, the pair will likely keep rising as bulls attempt to move above 50,000 in the coming days.
