Bitcoin jumped to about $24,300 on Wednesday after Federal Reserve Chair, Jerome Powell, suggested the U.S. central bank is seeing signs of waning inflation. This further fuelled investors’ notions that we have left the bear market behind.
Are they in for a rude awakening? Let’s find out.
FOMC Interest rate up 25 basis points
The Federal Open Market Committee (FOMC) on Feb 1 released a statement announcing the hike of its benchmark federal funds rate by 25 basis points. The range is now at 4.5% to 4.75%, the highest level in 15 years.
“The Committee anticipates that the ongoing increases in the target range will be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2 percent over time.”
In last week’s analysis, Bitcoin broke out but struggled to break above the 23k mark. The FOMC news this week was the deciding factor. Powell’s speech was the spark that send Bitcoin flying and breaking the previously established resistance. The volume also increased facilitating the pump but is this pump sustainable?
Many traders seem to think not.
Bitcoin Next Week
Bitcoin is sitting at another resistance around $24,500. It could take another major news to push Bitcoin above this resistance, otherwise, a crash back to the top of the falling wedge (retest) should be expected.
BTC is trading above the 50-day (2) and 200-day (1) moving averages, which is a pretty big deal in the world of technical analysis.
200-day moving average should now play the role of support for the price, preventing BTC from crashing lower. If Bitcoin decides to move higher, $25,220, and $31,785 are some of the key resistance points to check out.
Author’s Side Note
We are entering into unknown territory in 2023. The majority of the plans for the Great Reset by the World Economic Forum begin to take shape this year, propelling us full speed into a dystopian future. This can already be seen in how major long-standing conglomerates are falling left right and center.
The move to destroy the Dollar as the global reserve currency and adopt CBDCs has never been more aggressive. Bitcoin’s erratic price movements further render the majority of age-old technical analysis techniques useless. This manufactured pump is shaping up to be the largest Bull Trap in all of crypto history. Stay safe.
DISCLAIMER: The work included in this article is based on current events, technical charts, company news releases, and the author’s opinions. It may contain errors, and you shouldn’t make any investment decisions based solely on what you read here.
Vincent Munene is a freelance writer and a great blockchain enthusiast. Blockchain has changed his life in terms of financial freedom and in return, he likes to educate people and keep them up to date on everything blockchain. He is a Biochemist by profession and also loves to play the piano.