The expected Federal Reserve rate cut was announced on Wednesday. True to form, market makers sold Bitcoin down to $114,800. Then the price rebounded hard, stopping just short of $118,000. Is this rally just getting started?
3 more rate cuts to come?
A failing US jobs market undoubtedly forced the hand of the Federal Reserve, and not only were 25-basis points cut on Wednesday, but analysts are predicting a further 3 monthly cuts through to the end of the year. These easier financial conditions are likely to be beneficial for Bitcoin and the crypto market in general.
Dip, then strong rally
Source: TradingView
The 4-hour chart for $BTC shows that the price rallied strongly after the initial dump going into the FOMC meeting rate cut announcement on Wednesday. Once the price had hit a bottom, which coincided with the lower trendline of the ascending channel and the top of the small bull flag, it then rebounded vigorously.
Currently, the bulls are battling with the $117,500 horizontal resistance. This is the last big level to overcome before the $BTC price can head on back to the all-time high. A candle body pierced through the resistance level but a candle will have to open above in order to break this resistance.
A tale of two resistances
Source: TradingView
The daily chart presents a nice clear picture of what is in front of the $BTC price. It can be observed that the price is right up against the first of the two resistances. If $117,500 falls, $120,000 will be next. The second of these two resistances is also likely to have the top trendline of the ascending channel acting as resistance at the same time, so this could prove even more difficult to break. That said, a break of $120,000 would most definitely leave an easy route open to $124,000.
At the bottom of the chart, the Stochastic RSI has its indicators at the top, still signalling upside price momentum, while the RSI reveals that its indicator line has pierced through the downtrend line, has confirmed, and is rising upwards – a very positive signal for price action.
Two week chart says current resistance is critical
Source: TradingView
Zooming a lot further out, the 2-week chart shows a picture that is as clear as daylight. On this much higher time frame, the $117,500 resistance stands out as the critical level to break – and the $BTC price is there now!
If a candle body can open above this horizontal level at the end of next week, when this time frame comes to an end, this will likely signal that Bitcoin is about to embark on the next stage of its ascent.
At the bottom of the chart the indicator lines in the Stochastic RSI are angled downward. That said, they are approaching the 50.00 level so this could be a good place for them to reverse back up. If they can do so, stand by for fireworks.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.