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Bitcoin is trading at the 50-day and 200-day moving averages as it struggles to form a death cross.
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- Buy the BTC/USD pair and set a take-profit at 28,000.
- Add a stop-loss at 26,000.
- Timeline: 1-2 days.
- Set a sell-stop at 26,750 and a take-profit at 25,800.
- Add a stop-loss at 28,000.
Bitcoin and stocks retreat after the relatively hawkish statement by the Federal Reserve. The BTC/USD pair dropped to a low of 26,858, a few points below this week’s high of 27,447. Despite the drop, Bitcoin has jumped by more than 8.3% from the lowest level this month.
The main catalyst for Bitcoin, cryptocurrencies, and stocks was the Federal Open Market Committee (FOMC) decision. As was widely expected, the bank decided to leave rates unchanged between 5.25% and 5.50%.
The Fed has been in a strong hawkish tone in the past few months. In all, it has hiked rates from zero during the pandemic to 5.5%. In its decision, the accompanying dot plot showed that officials believe that rates will peak between 5.5% and 5.75%.
The Fed will be focusing on the upcoming inflation numbers. Inflation jumped to 3.7% in August, the highest level in months. Prices will likely continue rising as the price of crude oil soared to the highest level in more than
The BTC/USD pair has been in a bullish trend in the past two weeks. It dropped to a low of 24,780 on Monday last week, an important support since it was the lowest point on June 15th. It has formed a double-bottom pattern, which is one of the most bullish signals in the market.
Bitcoin is trading at the 50-day and 200-day moving averages as it struggles to form a death cross. This cross happens when the two moving averages make a bearish crossover. At the same time, the Relative Strength Index (RSI) has been rising and is now above the neutral point of 50.
Therefore, the outlook for Bitcoin is bullish as buyers target the key resistance level at the psychological point at 28,500.
The 4H chart show that the BTC/USD pair has made a good recovery after bottoming last week. It has remained above the 25-period and 50-period moving averages. At the same time, the Relative Strength Index (RSI) has dropped from the overbought level of 76 to 60.
Most importantly, Bitcoin has formed an inverted head and shoulders pattern, which is one of the most popular bullish signs. Therefore, the pair will likely bounce back as buyers target this week’s high of 27,515. A move above this resistance level will point to more upside to 28,447.
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