Bullish view
- Buy the BTC/USD pair and set a take-profit at 95,000.
- Add a stop-loss at 88,000.
- Timeline: 1-2 days.
Bearish view
- Sell the BTC/USD pair and set a take-profit at 88,000.
- Add a stop-loss at 95,000.
The BTC/USD pair continued its recent sell-off after the Federal Reserve released minutes of the last monetary policy meeting and after Nvidia published upbeat financial results. Bitcoin was trading at $91,300 on Thursday morning, a few points above this week's low of $88,930.
The BTC/USD pair reacted to the Fed minutes, which cast doubt on whether officials will cut interest rates in the December meeting. These minutes showed that officials were deeply divided on whether to cut in October, with some members expressing concerns about inflation, which has remained above the 2% target for years.
On the positive side, Polymarket data shows that most traders believe that the bank will cut in December, which would benefit risky assets. Odds of these cuts have jumped to 67% from this week’s low of 50%.
Bitcoin also remained under pressure even as investors embraced a risk-on sentiment after Nvidia published strong earnings. The company anticipates that it will make over $65 billion in the fourth quarter, higher than the expected $63 billion.
The company’s revenue jumped by 62% to $57 billion, higher than the median estimate of $55.2 billion. Most importantly, Jensen Huang maintained that he was not seeing an AI bubble, which many investors have been fearing. These results pushed US futures higher, with the Nasdaq 100 Index rising by 385 points.
The BTC/USD pair also retreated as investors continued to offload their ETF investments. ETF outflows have jumped to over $740 billion this week, bringing the cumulative total inflows to about $58 billion, down from $65 billion at the peak.
BTC/USD Technical Analysis
The daily timeframe chart shows that the BTC/USD pair has been in a strong downward trend this month. After attempting to recover on Wednesday, the pair lost momentum and hit a low of 88,930, its lowest level since April 25.
The pair has remained below the Supertrend indicator and has already formed a death cross pattern, which happens when the 50-day and 200-day Exponential Moving Averages crossed each other. The Relative Strength Index has moved to the oversold level of 30.
Therefore, the encouraging Nvidia earnings and the stock market performance will likely draw investors into crypto as well and possibly push Bitcoin higher. A recovery may push it to the psychological level at 95,000
A drop below this week’s low of 88,930 will invalidate the bullish outlook and point to more downside.
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