The crypto landscape was set ablaze this week as Bitcoin notched a new weekly high of $26,823 on Sep. 28. This comes in the face of impending comments from Jerome Powell, Chair of the U.S. Federal Reserve. Crypto enthusiasts are optimistic, expecting fresh cues about the direction of the monetary policy. Despite the upward trend, some maintain a healthy level of skepticism, well-insulated against the vicissitudes of the market.
Despite only registering a moderate 1.93% increase, Bitcoin staged an impressive comeback on the same day as it demonstrated what some cryptanalysts describe as a classic “pump and dump.” The digital currency suddenly shot up to $26,823, showing a 2% daily gain. However, it retraced all of its progress soon after. From then on, Bitcoin’s value began a slower grind upwards, drawing nearer to the $27,000 mark.
This upward turn seemed to coincide with the latest U.S. macroeconomic data. GDP for the second quarter showed 1.7% year-on-year growth, falling short of the predicted 2.0%. However, Personal Consumption Expenditures (PCE) index data for August aligned with expectations, reflecting well on Bitcoin’s performance.
On the other hand, market watchers caution against getting too carried away. Daan Crypto Trades, a popular crypto trader and analyst, while optimistic about Bitcoin’s strength, cautioned that the market could retrace later, in a situation where current longs can’t keep up the pace. It seems Bitcoin is not entirely out of the woods yet.
Nevertheless, according to Rekt Capital, a fellow trader and analyst, Bitcoin needs to break crucial resistance trend lines to shape a significant shift in market tendencies. Rekt Capital further noted that Bitcoin could rise to $29,000 and still form part of a broader comedown. To add, indicators suggest little resistance under the $27,000 mark, which could aid Bitcoin in its climb.
In summary, the fortunes of the cryptosphere are at a delicate impasse as we stand on the brink of fresh statements from the Federal Reserve Chair. While optimism is rife, caution and rationality shouldn’t be thrown to the wind. The recent Bitcoin surge does well in highlighting the dualistic nature of the market – high-risk, yet high-reward. As always, the ensuing decisions are left to investors who must balance their optimism against market realities.
Source: Cointelegraph
