Over the weekend, BTC almost broke through the $27,000 resistance, showcasing the strength of the world’s most valuable cryptocurrency. Despite its bullish performance, BTC experienced a slight retracement to $26,278. Currently trading at $26,408, it seems that investors and traders are eyeing new opportunities amidst the coin’s recent dip to $24,775.
The unexpected plunge of Bitcoin’s price followed the US Federal Reserve’s decision to halt interest rate hikes. Even though this was in line with market expectations, the announcement was overshadowed by Federal Reserve Chair Jerome Powell’s comments regarding potential rate hikes to push inflation towards 2%. Initially disappointed, investors seem to be reassessing the short-term opportunities brought about by the unchanged interest rates.
As Crypto fund manager BitBull Capital’s CEO Joe DiPasquale explains, the environment now appears more supportive for crypto assets, and all eyes are on Bitcoin, whose rising dominance is due to selling pressure in altcoins. However, he warns that the market leader will need to maintain the range between $20k – $22k to keep bullish sentiments alive.
Developments on the Bitcoin price chart indicate the nurturing of a potential V-shaped recovery, with an insight of $42,000. Bitcoin price began this week with a 0.5% loss during the Asian trading session, bouncing off support provided by the 100-day Exponential Moving Average (EMA) at $26,278. To close the gap to $27,000, this support is crucial throughout the day.
Bulls face a strong resistance slightly above BTC’s current market value, as indicated by the 50% Fibonacci retracement level. To overcome this hurdle, a sustained break above it is required before the bears take control of the subsequent sell signal. The Moving Average Convergence Divergence (MACD) indicator reveals an emerging sell signal as the MACD line flips below the signal line.
A recent forecast by Captain Faibik, who has 61,000 followers on Twitter, suggests that Bitcoin price may be gearing up for a massive breakout to $42,000, based on the formation of a cup and handle pattern on the weekly chart. Faibik’s tweet adds fuel to the bullish sentiment.
While the bulls appear to have the upper hand, traders must keep an eye out for potential reversals, especially if the 100-day EMA support weakens, which could lead to more significant losses below $25,000. Alternatively, a breakthrough in resistance at $27,000 may set the stage for the anticipated breakout to $42,000.
Source: Coingape
