Bitcoin Bulls Set Sight On $28,000 Price With Investors Adopting A Wait-And-See Approach
- Bitcoin could hit the $28K mark despite hawkish remarks by the Federal Reserve.
- Traders are keeping their eyes peeled on central bank decisions on monetary policy in leading economies.
- Other ancillary factors are expected to play a role in Bitcoin’s pricing in the coming weeks.
As Bitcoin (BTC) continues to hover around the $27K mark, investors are brimming with optimism that the largest virtual currency can break the $28K mark despite the unsavoury remarks from the Feds.
On Wednesday, the U.S. Federal Reserve hinted at plans to keep interest rates higher in 2024 at over 5%, contrary to the widely anticipated rates of 4.3%. According to a statement, the Federal Reserve noted that the decision was necessary to “return inflation to 2% over time.”
Traditionally, BTC and other virtual currencies have recorded rallies in the days following a reduction in interest rates. On the flip side, it is not unusual for virtual currency prices to plummet during periods of monetary contraction.
However, the markets took the Feds’ plan of a rate hike with an iron chin, with prices falling by only 1% in the hours following the announcement. After briefly falling to $26,900, BTC reclaimed $27,000, with analysts predicting a march to $28K in a strong show of resilience against the Feds’ decision to increase interest rates.
Although optimism continues to run high, some analysts call for a measured approach from the bulls, pointing out that higher rates and a dip in the stock markets “are not good for BTC.” Others have noted that profit-taking should be expected in the coming days, particularly from retail traders, regardless of the “buying support” at the present levels.
“It is hard for us to take today’s announcement with too much optimism,” said Michael Silberberg, an executive at AltTab Capital. “It came as a surprise that the report emphasized slower rate cuts moving forward than previously projected.”
Apart from the FOMC meeting, investors are keenly watching the rate decision of regulators in key economies. The central banks of England, Switzerland, and Japan are expected to reveal new policy directives in the coming days, which pundits say could affect investor sentiments.
“All financial markets have taken a wait-and-see approach ahead of monetary policy decisions in the U.S., Switzerland, the U.K., and Japan,” remarked Alex Kuptsikevich, an analyst at FxPro.
Not so-promising technicals
Onchain analysts opine that the technicals for BTC do not appear promising, forcing investors to latch onto fundamentals for direction. Some investors are banking on the historical seasonality of BTC for a bull run in the last quarter of the year, while others are expecting a jolt in prices from the US securities watchdog via a spot-based Bitcoin ETF.
Over the last decade, the last quarter of each year is typically the strongest for BTC, with bulls hoping for prices to climb as high as $37K before the end of the year.
“The situation for Bitcoin is bearish if one looks solely at the technical picture on the chart,” said Kuptsikevich. “The corrective bounce in BTC is formally over; the price has fallen below the moving averages, and the short-term oversold condition is complete.”
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