There is a likelihood that the pair will keep rising as bulls target the upper side of the triangle pattern at 44,000.
Buy the BTC/USD pair and set a take-profit at 44,000.Add a stop-loss at 40,000.Timeline: 1-2 days.
Set a sell-stop at 42,400 and a take-profit at 40,000.Add a stop-loss at 44,000.
The BTC/USD pair held steady on Tuesday and in the overnight session even after the hawkish Fed chair statement. It rose above the key resistance level at 42,000. Other coins like Ethereum, Solana, and XRP also bounced back.
Cryptocurrencies Going Mainstream
Last week, the Fed concluded its monthly meeting and did what most analysts were expecting. It decided to implement its first interest rate hike since 2018. Also, the officials hinted that they will hike in the remaining 6 meetings of the year and then hike rates three times in 2023.
On Monday, Jerome Powell came out more forcefully than what he said in his press conference on Wednesday, He said that he will support a half a percentage point rate hike in May. He also hinted that the bank will be more aggressive in a bid to lower inflation.
The market reacted in a bearish way after the statement on Monday. Stocks and digital coins declined while the US dollar held steady. This turned around on Tuesday because the statement was in line with what most analysts were expecting.
The BTC/USD pair also rose because cryptocurrencies seem to be going mainstream. Recently, central banks of Australia, Malaysia, Singapore, and South Africa have given their approval for the use of Ethereum’s blockchain. Meanwhile, Malaysia’s finance minister said that the country should adopt Bitcoin as a legal tender.
If this happens, it will become the second country to do so after El Salvador. The decision by El Salvador has had mixed success. The government bought Bitcoin at a higher price than where it is today. Also, a recent survey showed that only 14% of businesses had transacted in BTC since September. With its volatility rising, the coin will be a hard sell.
The BTC/USD pair has been in a tight range in the past few weeks. It has remained inside a wide range of between 44,000 and 37,000. Still, a quick look at the four-hour chart shows that some positive signs are emerging. The pair has moved above the ascending trendline shown in black. It has also moved above the 25-day and 50-day moving averages. Further, the pair has move above the key resistance level at 42,418.
Therefore, there is a likelihood that the pair will keep rising as bulls target the upper side of the triangle pattern at 44,000. A drop below 42,418 will invalidate this view.