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The daily chart shows that the BTC/USD pair managed to pick its pieces after falling to below 20,000 last weekend.
- Buy the BTC/USD pair and set a take-profit at 30,000.
- Add a stop-loss at 25,000.
- Timeline: 1-2 days.
- Set a sell-stop at 26,300 and a take-profit at 25,000.
- Add a stop-loss at 28,200.
Bitcoin continued its remarkable comeback during the weekend as investors continued rushing to its safety amid rising volatility in the market. The BTC/USD price soared to a high of 28,200, the highest level since June last year. It has soared by more than 80% from its lowest point this year.
The financial market has been characterized by rising volatility and increased fear in the past two weeks. The closely-watched VIX index has risen above $25 while the fear and greed index has dropped to the fear zone of 25.
This performance is mostly because of the stress in the banking sector and the upcoming actions by the Federal Reserve. During the weekend, the main topic was the discussions to bail out Credit Suisse, the second-biggest bank in Switzerland.
According to the Financial Times, UBS agreed to acquire the company in a $2 billion deal that was backstopped by the Swiss government. That valuation was much lower than where it ended last Friday at. At its peak, Credit Suisse was valued at over $50 billion.
Therefore, there is a likelihood that banking stocks will remain extremely volatile on Monday as investors reflect on the downfall of one of the most systematically-important banks. This volatility will likely benefit risky assets like Bitcoin and gold, which have done well in the past few weeks.
The main catalyst for the BTC/USD pair will be the upcoming Federal Reserve decision scheduled on Wednesday. Traders have a mixed opinions about what to expect, with Fed futures pointing to a 0.25% compromise hike.
The daily chart shows that the BTC/USD pair managed to pick its pieces after falling to below 20,000 last weekend. It has now jumped above the key resistance point at 25,203, the highest point on February 17 and August 14 last year. Bitcoin also crossed the 23.6% Fibonacci Retracement level at 23,415.
Most importantly, Bitcoin has formed a golden cross, which forms when the 50-day and 200-day moving averages cross each other. The Relative Strength Index (RSI) has moved to the overbought level. Therefore, the pair will likely continue rising this week as the bullish momentum continues. This trend will see it retest the key resistance point at 30,000. The stop-loss of this trade will be 25,203.
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