- The Bitcoin price upswing, backed by low trading volume, indicates a lack of strong conviction from buyers to continue upstream.
- According to FedWatchtool, the odds for 25% bsp in an interest rate cut have surged to 85.1%.
- BTC’s fear and greed index at 15% accentuates extreme fear among market participants.
The pioneer cryptocurrency, Bitcoin, rebounded over 3% to reclaim the $90,000 mark. The buying pressure can be attributed to the surprise plunge in U.S. initial jobless claims to 216k, bolstering odds for a December rate cut. With the upswing, the coin price also regained key technical support, signaling a potential for renewed recovery ahead.
BTC Rebounds on Dovish Fed Tone and Strong Labor Market Data
Since last week, the Bitcoin price has rebounded from $80,537 to the current trading value of $90,110, registering a 12.3%. The rally had gained momentum after signals from Federal Reserve members suggested a more accommodative approach ahead of the December policy meeting. Their comments increased the likelihood of a quarter-point cut in benchmark rates, calming fears about extended tightening.
Momentum gained even more with new labor market numbers released by the Labor Department. The new unemployment filings amounted to 216,000– the lowest number of filings in more than seven months, since mid-April. Officials also increased the previous week’s count from an initial 220,000 to 222,000, highlighting a resilient job picture in the face of broader economic headwinds.
Adding to the bullish backdrop, talk in Washington circles points to economist Kevin Hassett coming out on top to succeed Jerome Powell at the helm of the Fed. Hassett, who has expressed his support of cryptocurrencies in the past, previously advised Coinbase through its strategic board. His possible appointment could move the central bank toward policies more conducive to blockchain innovations and aggressive rate easing, with rates as low as 1% possible in the coming years.
The interplay of changes in policy and labour conditions continues to be a key driver in the volatile path of crypto forward.
Bitcoin Price 6% Short of Major Resistance Test
With an intraday gain of 3.45%, the Bitcoin price reached its current trading value of $90,320. This upswing stands as a crucial move for buyers as it invalidates a recent breakdown attempt from a long-awaited support trendline.
Since October 2023, the BTC price has used a support trendline as dynamic support and recouped its bullish momentum. Last week, the coin price gave a bearish breakdown below this level, signaling a risk of prolonged correction.
However, the coin sellers failed to offer a suitable follow-up on the downside, resulting in a sideways shift in price. Amid this consolidation, the price eventually reclaimed the breached trendline, trapping the hasty sellers of the market.
A negative crossover state between the exponential moving averages (20, 50, 100, and 200) further accentuates a bearish market sentiment.
Thus, the Bitcoin price could rise another 5.7% before hitting key resistance from a downsloping trendline. If the sellers continue to defy this resistance, they would gain suitable ground to drive an extended correction below $85,000.
That said, if the coin price breaks above the resistance trendline, the buyers could gain sufficient momentum for driving an extended recovery.
Also Read: Ethereum Surpasses $3,000 Mark as Odds of Fed Rate Cut Rise
Credit: Source link