A rest week ensues after a strong rally last week, with BTC trading in the range and buyers losing steam. Are there obvious opportunities that traders are missing?
We entered last week with buyers still having the upper hand. They were pressing the market up with retracements to higher and higher levels being bought, hence posting higher lows.
However, they were not able to push the market decisively upwards as buying pressure around highs was easily absorbed by sellers.
The market was getting compressed before the Fed rate decision and subsequent press conference on Wednesday.
As expected, Fed raised rates by 25bps, which initially gave BTC a relief rally and posted new highs. It was short-lived as the market subsequently sold off very aggressively on the back of hawkish Powell’s presser.
BTC was just shy of the $26,500 support area. That’s where buyers stepped in to push the market back up.
After posting a lower swing high on Thursday, the market was trading sideways, oscillating around the middle of the range. BTC finally finished the week practically unchanged vs. where it started.
As long as we stay in the current $26,500 - $28,900 range, it’s better not to be too biased but trade the range and look for intraday trading opportunities both from the long and short side as no one side is strongly dominating now.
If we manage to break $28,900 with daily close above, it should open the way for further upside towards $32,400. On the other hand, if BTC breaks $26,500 it should eye the $25,300 area. Stay open-minded and flexible.
On the macro front this week, the key focus will be on the Fed's favored inflation gauge – PCE on Friday.
Other data to keep an eye on:
Tuesday: Wholesale Inventories, House Price Index, CB Consumer Confidence
Wednesday: Pending Home Sales
Thursday: Q4 GDP, Jobless Claims
Friday: CNY PMI, EUR CPI, Michigan Consumer Confidence
Just like in recent weeks, market participants will be closely following any news on the situation in the banking sector as they have large potential to affect markets.
Have a great trading week ahead!
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