Bitcoin (BTC/USD) Retreats To Support Ahead Of FOMC

Bitcoin bulls continue to fight for dominance after achieving yet another record high of $61,187 over the weekend, helped along by the enactment of the $1.9 Trillion US Fiscal Stimulus package. But as interest rates remain near zero, retailers and institutions continue to flock towards the major cryptocurrency, supporting the adoption of Bitcoin as an alternative method of payment and as an alternative to GoldSilver, and safe-haven assets which often function as a hedge against inflation and US Dollar weakness. As a result, speculation has remained favorable towards Bitcoin bulls, allowing them to march along the upward trajectory that has pertained since late last year.

However, as James Stanley highlighted recently, the US 10-Year Treasury note yield in 2021 has shared a similar trajectory to Bitcoin, with rates surging approximately 80% from January’s low. However, as inflationary and yield curve concerns continue to mount, the big question is how the Fed might navigate in that environment, drawing specific attention to tonight’s FOMC Economic Projections as well as the Fed Press Conference, a potential catalyst for the imminent BTC/USD move.

Bitcoin (BTC/USD) Retreats to Support Ahead of FOMC

DailyFX Economic Calendar

BITCOIN (BTC/USD) TECHNICAL ANALYSIS

Current Bitcoin price action has stalled momentarily after achieving yet another record high of $61,714 over the weekend. But, after failing to break through $62,000, Bitcoin prices retreated, finding solace the key psychological level of $55,000, currently holding as support. This week, prices have continued to display signs of consolidation and remain encapsulated by the Fibonacci retracement levels of the 2020 – 2021 move, providing support and resistance for short-term movements.

Meanwhile, on the weekly time-frame, the RelativeStrength Index (RSI) and the Moving Average Convergence/Divergence (MACD) remain in oversold territory for now, with price action resting well above both the 50 and 200-Period Moving Average.

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