Bitcoin Holds Near $85K: FOMC Meeting Looms
Bitcoin (BTC) faced resistance at $85,000 on March 17th, failing to decisively break through. Daily highs fluctuated between $84,000 and $85,200 since March 12th, but closing prices remained below $84,600.
The current price action on the 1-hour chart signifies a period of uncertainty and heightened risk, commonly referred to as "no man's land." The upcoming Federal Open Market Committee (FOMC) meeting on March 18-19 will likely cause significant price volatility.
Interest Rate Outlook and Market Sentiment
CME's FedWatch tool predicts a 99% chance that interest rates will remain between 4.25% and 4.50%. While a rate cut is unlikely, the market largely anticipates this scenario. The focus shifts to the Fed chair, Jerome Powell's, speech following the FOMC meeting.
Based on recent data (2.8% CPI, 2.5%-2.6% PCE, 4.1% unemployment, and 2.3% GDP growth in Q4 2024), Powell's stance is expected to be hawkish. However, Polymarket indicates a 100% chance of the Fed concluding quantitative tightening by April 30th, potentially increasing the likelihood of a rate cut later this year.
Critical Bitcoin Price Levels
For Bitcoin to reach higher highs around $90,000, it needs to overcome the $85,000 resistance and establish it as support. Reclaiming its position above the 200-day exponential moving average (EMA) is crucial after falling below it on March 9th.
Positive factors include renewed demand from Bitcoin ETFs, which saw $274 million in inflows on March 17th, the highest since February 4th. Conversely, failure to break $85,000 could lead to a price drop below $78,000, potentially targeting $74,000 (the previous all-time high from early 2024).
Further downside could see a retest of the $70,530 to $66,810 range, with a possible drop to $69,272 (erasing the "Trump pump" gains). Analysts like SuperBitcoinBro and Nebraskangooner suggest potential support levels around $71,300 to $73,800 and a possible retest near $70,000. The FOMC decision remains a significant wildcard.
Disclaimer: This article does not provide investment advice. All investment decisions involve risk. Conduct thorough research before making any investment choices.
Codeum offers comprehensive blockchain security services including smart contract audits, KYC verification, custom smart contract and DApp development, tokenomics and security consulting, and partnerships with launchpads and crypto agencies. Contact us to learn more.