Bitcoin Blows Past $25,000 As BTC Faces Obstacles Ahead
In recent days, Bitcoin investors and traders have faced strong profits, resulting in a slight drop in the global cryptocurrency market cap.
Adding to the fear, uncertainty and doubt were the previous collapses from cryptocurrency banks Silvergate and Signature, as well as venture capital bank Silicon Valley Bank. However, the bulls found their footing as BTC led the market higher once again.
According to CoinGecko at the time of this writingthe cryptocurrency king is up nearly 10% in the past 24 hours, breaking above the $25,000 level that, timing permitting, would allow BTC to reach a higher price target in the coming days or weeks.
With crypto-related stocks and crypto itself rallying, investors and traders are sure to ride out the weekend with some gains.
TradFi sentiment turns positive for crypto
Traditional financial institutions are still strong players in the cryptocurrency industry. Big names like Blackrock, BNY Mellon and JP Morgan invested in crypto companies, prompting local rallies that encourage investors to hold on to their portfolios.
This can be seen in the current market environment. With the US Federal Reserve advertising which will cover the deposits of SVB clients, sentiment in crypto changed from bearish to bullish in a matter of days.
The subsequent collapse of several banks in less than a month also raises questions about how rigid the banking system really is.
Because of this, it may not be likely that the Fed will raise interest rates once again amid the current market headwinds.
Bitcoin’s recent price movement is caused by this anticipation that the US central bank would lessen its hawkish behavior in order to support the broader financial market.
March 22nd will be the date when the Fed decides whether to raise interest rates by 25 basis points. If they decide to raise it, despite the anxiety surrounding the banking system, we could see the pain trickle down to equity and crypto markets.
Bitcoin Bulls Should Keep an Eye on Fed Actions
Investors are taking advantage of the recent price swing to grab some profits. At the time of writing, the token is trading with a red candle, a strong indication that investors are willing to sell rather than hold them for the long term.
BTC total market cap at $530 billion on the daily chart at TradingView.com
Bitcoin bulls should watch the Fed’s March 22 announcement as it could affect sentiment surrounding the cryptocurrency. With that in mind, holding the current support line at $24K will give investors a launching pad should the token price turn down.
The next target for bulls in the medium to long term should be $30k. If they switch this resistance to support, they can practically hit the April 2022 range of $37,000 and above.
-Featured image from Smithsonian Magazine