Bitcoin (BTC) circled $102,000 into the Dec. 19 Wall Street open as crypto sentiment cautiously recovered from a new macro scare.
BTC/USD 1-hour chart. Source: Cointelegraph/TradingView
Fed halts Bitcoin bull market in its tracks
Data from Cointelegraph Markets Pro and TradingView showed 2% BTC price gains versus the daily open.
Bitcoin had joined a crypto and risk-asset sell-off at the hands of the US Federal Reserve the day prior, during which BTC/USD fell to lows of $98,695 on Bitstamp.
The blow came from Fed Chair Jerome Powell, who signaled reluctance over future interest rate cuts amid a rebound in various inflation gauges.
“With today’s action, we have lowered our policy rate by a full percentage point from its peak, and our policy stance is now significantly less restrictive,” he said in a prepared statement at the press conference that followed the move to cut the benchmark interest rate by 0.25%.
“We can therefore be more cautious as we consider further adjustments to our policy rate.”
Both the S&P 500 and Nasdaq 100 ended the day’s trading session down by around 3% as a result.
The latest estimates from CME Group’s FedWatch Tool nonetheless put the odds of a further rate cut at the Fed’s next meeting in January at just 8.6%.
Fed target rate probabilities. Source: CME Group
Analyzing low-timeframe BTC price action, popular trader Skew remained modestly upbeat about Bitcoin’s recovery.
“So far no trend invalidation even with the sweep of last weeks low & market demand,” he wrote in part of an X post about the 4-hour chart.
“Would like to see price remaining strong above VAH here & sustained passive demand under price for a recovery / higher.”
BTC/USDT 4-hour chart. Source: Skew/X
Skew referred to the value area high, or VAH, which made the area above $101,500 important to hold.
BTC price risks January pullback
Others recommended taking a longer-term view amid heightened volatility, with Bitcoin still up 6% in December.
“$BTC Price action is choppy and doesn't look pretty. Yet, it's still trending up slowly,” fellow trader Daan Crypto Trades continued in part of his own X post.
Daan Crypto Trades acknowledged the cathartic effect of mass liquidations accompanying the market downturn. Data from monitoring resource CoinGlass put the cross-crypto total for the 24 hours to the time of writing at $800 million.
“Back in 2021, Wednesday was usually the day where we saw a lot of liquidations,” he added about market behavior during Bitcoin’s previous bull market.
“It almost became a trend at some point. Up only -> Mid week liquidation wicks -> Retrace. Would be interesting to see if that repeats.”
Crypto liquidations (screenshot). Source: CoinGlass
More bearish predictions nonetheless came from those wary of the macro implications. Trader and analyst Mark Cullen warned of a “larger Bitcoin pullback” potentially still to come.
“BTC is still holding 100k which is key to seeing maybe 1 more push before the bigger correction hits,” he warned X followers, predicting such a scenario playing out in January.
BTC/USD chart. Source: Mark Cullen/X
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
