Bitcoin (BTC) price has experienced a slight drop of over 1% in the past 24 hours, reaching a low of around $114,665. This decline comes after encountering resistance around $117k over the weekend, leading to a correction in the wider altcoin market. Traders are now eagerly awaiting the Federal Reserve’s upcoming rate decision, which has created short-term uncertainty in the leveraged crypto market.
The recent liquidation of approximately $440 million in leveraged positions has added to the market’s uncertainty. The total crypto market cap has also seen a 1.2% decrease, hovering around $4 trillion during the late New York session.
Has Bitcoin Price Signaled Bearish Sentiment?
In the daily timeframe, the BTC/USD pair is showing signs of a potential mid-term reversal pattern. The recent rebound could potentially be a bear flag with a target around $92k, a significant support level that could serve as a launching pad for the next bull rally. The bearish pressure is further supported by the BTC Futures CME gap that remains unfilled between $91.9k and $92.5k. However, a close above $122k could trigger the next bull rally towards new highs.
How to Trade the FOMC Data?
The Federal Reserve is set to release key economic data, including its benchmark interest rates, on Wednesday, September 17. President Trump has been vocal about his desire for the Fed to cut rates, especially in light of the weak labor market. With prediction markets indicating a 91% chance of a 25 bps rate cut, traders are anticipating the Fed’s decision.
Ahead of the FOMC data release, BTC price has rallied on expectations of a rate cut, potentially setting the stage for a "sell-the-news" scenario. However, with analysts predicting multiple rate cuts in the future, Bitcoin is poised for a potential rebound in a parabolic fashion.
In conclusion, Bitcoin’s price movements are closely tied to external factors such as the Federal Reserve’s rate decisions. Traders should closely monitor market developments and key economic data to make informed trading decisions in the volatile cryptocurrency market.