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Start for freeBitcoin Reaches New All-Time Highs
Bitcoin has finally broken through to new all-time highs, setting up major bullish price targets. However, in the short term, Bitcoin is showing signs of a potential bearish divergence as we approach the next Federal Reserve meeting where a rate cut is expected.
Federal Reserve Meeting and Interest Rate Decision
The Federal Open Market Committee (FOMC) meeting, also known as the Fed meeting, is scheduled for today at 7:00 PM GMT. This is when the Federal Reserve will announce their decision on interest rates.
Current market expectations are:
- 96% probability of a 25 basis point rate cut (0.25% reduction)
- 4% probability of a 50 basis point rate cut (0.5% reduction)
The expected 25 basis point cut is largely priced into the market already. If this occurs, we shouldn't see major market moves based on that outcome alone. However, any deviation from expectations could lead to increased volatility:
- A 50 basis point cut would likely be very bullish for markets
- No rate cut would likely be bearish for markets
Bitcoin ETF Flows
Recent Bitcoin ETF flows have shown significant activity:
- Monday saw a large net outflow of over $500 million from Bitcoin ETFs
- Wednesday saw a massive net inflow of nearly $622 million into Bitcoin ETFs
This influx of capital is contributing to buying pressure and pushing prices higher in the short term. Sustained large inflows over time could potentially lead to a supply squeeze for Bitcoin, given its fixed maximum supply of 21 million coins.
Technical Analysis of Bitcoin
Larger Timeframes
On the larger timeframes, Bitcoin is showing strong bullish signals:
- 4-day timeframe: Super Trend indicator remains green
- 2-day timeframe: Price has broken above a major descending resistance line
Daily Timeframe
On the daily chart, Bitcoin has now closed a candle above $74,000, confirming the breakout to new all-time highs. This is a very bullish signal. The previous resistance zone between $72,000 and $74,000 should now act as support.
However, there is a potential bearish divergence forming on the daily timeframe:
- Price is making higher highs
- RSI is showing lower highs
This divergence is not yet confirmed and requires a couple of red candle closes to cement the lower high in the RSI. If confirmed, it could lead to a short-term pullback or sideways consolidation over the next week or so.
Price Targets
With the breakout to new all-time highs confirmed, new price targets come into focus:
- $89,000 - Based on the 1.618 Fibonacci extension (linear settings)
- $80,000 - Based on the measured move of the cup and handle pattern
It's important to note that price is unlikely to move straight to these targets. Expect some consolidation and potential pullbacks along the way.
Short-Term Outlook
On the 3-hour timeframe, a bearish divergence has just been confirmed and is starting to play out. This suggests we may see a short-term cooloff in the form of sideways consolidation or a slight pullback over the next couple of days.
Ethereum Analysis
Weekly Timeframe
Ethereum is currently holding a major trendline support that has been in place since mid-2022. This support sits around $2,400. Previous bounces from this support level have led to significant bullish movements over the following weeks and months.
3-Day Timeframe
Ethereum is attempting to break above a major resistance line around $2,800. This level was previously support and is now acting as resistance. A confirmed breakout above this level with candle closes above $2,800 would be a very bullish signal.
If the breakout is confirmed, potential targets include:
- $3,200 in the coming weeks
- $3,500 thereafter
- $3,900 to $4,000 based on previous highs
12-Hour Timeframe
Ethereum is attempting to break above the $2,700 to $2,800 resistance zone. The RSI on this timeframe is entering overbought territory, which has previously led to slowdowns or pullbacks. This suggests we may see a retest or consolidation if the breakout is confirmed before continuing higher.
Solana Analysis
Daily Timeframe
Solana is attempting to break out above a critical resistance area between $183 and $187. This breakout still needs to be confirmed with daily candle closes above $187.
Like Bitcoin and Ethereum, Solana is showing a potential bearish divergence on the daily timeframe. However, this divergence is not yet confirmed and Solana's RSI has more room to run before reaching overbought levels.
If Solana confirms a breakout above $187, the next major resistance area lies between $200 and $210.
4-Hour Timeframe
On the shorter-term 4-hour chart, Solana is reaching overbought territory after a strong bullish move. This suggests we may see a short-term slowdown, but the larger timeframes remain bullish.
Trading Opportunities
For those looking to trade these market moves, it's important to use reputable exchanges and take advantage of available bonuses. Some options include:
- Bybit - Offers up to a $30,000 deposit bonus and a $500 position airdrop for new users.
- Bonex - Provides up to a $5,500 deposit bonus and a 10% discount on trading fees. This exchange is accessible without KYC, making it an option for traders in regions with restrictions.
Always conduct your own research and understand the risks involved in trading cryptocurrencies.
Conclusion
The cryptocurrency market is at an exciting juncture with Bitcoin reaching new all-time highs and other major coins like Ethereum and Solana attempting significant breakouts. While short-term pullbacks and consolidations are possible, the larger trend remains bullish for now.
Key points to watch:
- The outcome of the Federal Reserve meeting and its impact on the broader market
- Confirmation or invalidation of potential bearish divergences on Bitcoin and Ethereum
- Ethereum's attempt to break and hold above $2,800
- Solana's potential breakout above $187
As always in the cryptocurrency market, volatility can be expected. Traders and investors should remain vigilant, use proper risk management techniques, and stay informed about both technical and fundamental factors affecting the market.
Article created from: https://youtu.be/YGS0ctIpZh8?si=Em9xm0V5nh_RMNso
