Bitcoin Bounces at $20K. NFP Eyed for New Direction
Crypto Is Not Scared by Powell. Altcoins Surge.
As widely expected, the Fed decided to add 75 bps to the interest rate, while Chair Powell emphasized the continued need for a tight monetary policy. This suggests that the pace of the rate hikes will not slow down, at least for the next FOMC meeting.
EUR/USD decided to move down after a bit of back and forth at the time of the interest rate announcement and during the press conference but Bitcoin proved to be more resilient and did not fall below the $20K level. The “big boys” Bitcoin and Ethereum are closely tied to institutional money but altcoins, on the other hand, are not. That’s probably why after a brief dip, altcoins started to rise, seemingly ignoring Powell’s hawkish comments made during the presser.
Binance Coin (BNB) is up more than 20% in the last 7 days, currently trading at $346.35. Litecoin (LTC) added 18.55% in the last 7 days, Polygon (MATIC) is up more than 25%, and Dogecoin (DOGE) is up a whopping 66% for the same period. It has to be said that the meme coin benefited a lot from Musk’s Twitter acquisition, hence its rocket-style climb.
With the NFP report coming out later in the day, these already bullish altcoins may add more gains but with these high-impact events, it’s always better to stay on your toes. The labor market is expected to shrink from the previous 263K to 197K but a stronger number would hurt crypto and strengthen the US Dollar. If that is the case, pairs with USD as the second currency will go down but there are other variables such as the Average Hourly Earnings and Unemployment Rate (released at the same time, 12:30 pm GMT).
Technical Outlook – BTC/USD
After the initial climb above $20,000 (on October 25), we talked about a possible move down to retest the broken level. That retest occurred soon after the FOMC Meeting and presser, resulting in what seems to be a valid bounce.
For the time being, we can consider that $20,000 is support, which means that Bitcoin is headed higher. The first hurdle is the recent high made around $21,000, followed by $22,780 (September 22 top). A sustained climb may reach $25,000 but it’s a bit premature to talk about it.
A breakdown below $20K will take Bitcoin into the bullish trend line seen on the chart and possibly into the lower Bollinger Band. The U.S. labor market numbers due later today will play an important role, probably determining which scenario takes shape.
