As Jerome Powell, the Federal Reserve (Fed) Chair, prepares to return to Jackson Gap this Friday, the Bitcoin (BTC) market is experiencing a way of anticipation as a result of similarities within the present worth motion in comparison with the interval main as much as final yr’s speech.
Key transferring averages have been examined and misplaced over the previous two weeks, adopted by a interval of consolidation, paying homage to earlier occasions.
Nonetheless, it is very important notice that these similarities don’t assure a repeat of the previous, as market situations and Powell’s stance have since developed.
Déjà Vu In The Bitcoin Market?
In accordance to Keith Alan, co-founder of research and crypto analysis agency Materials Indicator, final yr, within the two weeks previous Powell’s speech, BTC’s worth broke by essential technical assist ranges represented by the 21-day, 50-day, 100-day, and 200-week Transferring Averages (MA).
Subsequently, a interval of consolidation ensued, adopted by a big worth drop in response to Powell’s hawkish tone through the speech. Alan acknowledged:
Bear in mind when Fed Chair Powell spoke from Jackson Gap final yr and his hawkish tone triggered a 29% BTC dump that took 5 months to get better?
Notably, the latest worth motion within the Bitcoin market has displayed similarities to final yr’s sample. Over the previous two weeks, Bitcoin has examined and misplaced these identical key transferring averages, and it’s presently present process a part of consolidation, mirroring the occasions main as much as Powell’s earlier deal with.
Keith Alan emphasizes that since final yr’s Jackson Gap occasion, there have been notable modifications. Core inflation has decreased, and Powell’s method to communication has turn into extra “measured”.
It’s unsure whether or not Powell will undertake a hawkish or dovish stance in his upcoming speech, making it difficult to foretell the market’s response with certainty. What is clear, nevertheless, is that the market is primed for a big transfer.
Moreover, Alan means that the formation of a decrease low in worth will increase the chance of an extension of the present downtrend. Market contributors must be ready for the potential for additional testing of assist ranges.
Because the Bitcoin market awaits Powell’s speech, market sentiment stays dynamic. Merchants and traders are anticipating potential market-moving cues from the occasion.
Because the date of Jerome Powell’s return to Jackson Gap approaches, Bitcoin has displayed a notable restoration of two.1% throughout the previous 24 hours, marking a constructive upward motion that brings it nearer to the $27,000 threshold.
Nonetheless, it’s essential to notice that if the end result of Jerome Powell’s speech on Friday proves favorable for crypto traders and propels Bitcoin’s worth to greater ranges, the cryptocurrency could encounter a big impediment within the type of its 200-day transferring common positioned at $27,200.
Featured picture from iStock, chart from TradingView.com