The next day or 2 could give us an idea as to where we are going for the next couple of weeks, as there will obviously be a lot of decisions made based upon Federal Reserve policy.
- The BTC/USD has been rather noisy during the trading session on Wednesday as we are sitting right around the $17,500 level.
- Because of this, the market is more likely than not waiting on the CPI numbers coming out on Thursday, because of obvious inflation, and perhaps even more importantly, the reaction that the Federal Reserve will have to that potential inflation.
- The Bitcoin market desperately needs easy money to survive, because it’s the only thing that it has ever known. The market is hoping for more of an easy money policy because that’s exactly what has lifted Bitcoin for years.
From a technical analysis standpoint, it’s obvious that the $18,000 level is crucial, at least in the short term. If we can break above that level after the CPI announcement, that would be a very bullish sign and could send this market toward the $20,000 level. That of course is a large, round, psychologically significant figure that a lot of people would be paying attention to, so I would anticipate a little bit of resistance. Breaking above the $20,000 level would be a huge victory for Bitcoin, but it’s going to take a significant amount of momentum and force to make that happen.
Time Will Tell
If we were to turn around and break down below the 50-Day EMA, then it’s possible that we would pull back toward the bottom of the overall consolidation range, meaning somewhere near the $16,000 level. That is more likely than not if we have a hotter-than-anticipated CPI figure. That would probably have everything in a bit of a “risk off” mood, and therefore Bitcoin would get hit as a result.
The next day or 2 could give us an idea as to where we are going for the next couple of weeks, as there will obviously be a lot of decisions made based upon Federal Reserve policy. Bitcoin does not have much in the way of fundamentals helping it, as we are in “crypto winter”, but it’s it could open a short-term trade that we could take advantage of to the upside. On the downside, we can sort that as well. Only time will tell, but I think by the time we get through Thursday, we should have an idea of a nice setup in this market, so Bitcoin is something worth watching.
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