US Fed Meeting Shake-Up: Cryptocurrency Market Feels the Heat Ahead of Rate Cut Announcements
Everyone's on the edge of their seats as we gear up for the US Fed meeting happening tonight. It's a big deal because Jerome Powell is going to lay out what's coming in terms of rate cuts. Folks, let me tell you, the cryptocurrency market is already feeling jittery about this. bitcoin and ethereum, the top dogs of the crypto world, aren't immune either; they're leading the charge in what seems to be a cautious retreat.
As of the latest updates, bitcoin's taking a little bit of a hit, down by 0.37%, hovering around $66,121. ethereum's not spared either, seeing a drop of about 0.54% to land at $3,320. If we zoom out and look at the bigger picture, the entire global cryptocurrency market cap took a dip by 0.67%, biting down to approximately $2.39 trillion over the last day. And if that's not enough, the total crypto market volume has shrunk considerably by 18.40% to $62.74 billion in this time frame. Quite the numbers, right?
Key Levels Threaten bitcoin’s Bull Run
It seemed like bitcoin was on a sprint towards $70,000, but guess what? It's losing a bit of that steam. Despite breaking past the 20-day and 100-day Simple Moving Averages (SMAs), which many saw as a bullish sign, there’s now talk of a reversal. The appearance of a black crow pattern, typically a bad omen in market-speak, is stirring up some uncertainties.
According to the smart folks over at TradingView, bitcoin ran into a wall at the $70,015 mark. This resistance point hints at a possible double top formation—a classic reversal pattern. And let's not overlook the bearish divergence on the Relative Strength Index (RSI), suggesting the momentum might be changing gears.
Speaking of the RSI, it's trending below the signal line at 55.35, which strengthens the bearish outlook. It seems like the market might be heading for a consolidation phase before any potential recovery takes place. A lot to watch here, folks.
What’s Next for BTC?
Since early July, BTC showed some form of resilience, creating higher highs and higher lows, painting a bullish picture over the last month. However, with the recent sell-off, analysts believe BTC could be in for a test of its 100-day SMA of $64.5K if the bearish sentiment continues. This level could provide the support needed to resume its pattern of higher lows and possibly reclaim previous losses, eyeing the $68.9K mark along the 78.1 Fib level.
But, if the 100-day SMA doesn't hold up and BTC dips below its recent low of $63.4K, that's signaling a more negative shift. This scenario could potentially drag BTC down to the $62.8K area around the 50% Fib level, maybe even touching down on the $60K mark, a stronghold over the past four months.
Long-Term Holders Show Signs of Optimism
On a brighter note, it's not all doom and gloom. A recent chart from Glassnode shows a substantial uptick in the net positions of long-term bitcoin holders. As of late July 2024, these committed investors increased their bitcoin stash by 110,666.86 BTC, valued at $66,805.99 each. This shift to positive net position changes is a stark contrast to the selling frenzy seen earlier in the year, hinting at a resurgence of confidence among long-term players despite the market's current volatility phase.
So, as we watch the outcomes of the US Fed meeting and its impact on rate cuts, all eyes are on the crypto market's response. There's a mix of caution and optimism in the air. Will the short-term churn lead to long-term gains? Time will tell, but one thing's for sure, the crypto world is anything but boring.
