While the bullish trend will continue, the pair will likely pull back and retest the support at 23,000 and then resume the bullish trend.
Sell the BTC/USD pair and set a take-profi at 22,500.Add a stop-loss at 24,500.Timeline: 1 day.
Set a buy-stop at 25,000 and set a take-profit at 26,000.Add a stop-loss at 23,000.
The BTC/USD price continued rising as the bullish momentum continued. Bitcoin crossed the important resistance level of $24,000, which was the highest level since June 13th of this year. It has risen by more than 35% from its lowest level in June.
Softer Fed Action
Bitcoin and stocks have been in a strong bullish trend in the past few days as investors reflect on the actions of the Federal Reserve. Last week, most analysts predicted that the Federal Reserve will hike interest rates by 100 basis point after the strong inflation data.
Now, most analysts expect that the bank will be less aggressive than that. They expect that it will hike interest rates by 75 basis points as it continues fighting the soaring inflation.
Bitcoin is also rising as investors bet that fears of contagion that existed a few weeks ago have subsided. There were concerns that the collapse of platforms like Terra, Vauld, Celsius, Voyager Digital, and Three Arrow Capital would lead to a strong contagion in the industry.
Many analysts compared it to the collapse of Lehman Brothers and its impact on the financial sector. However, most of the biggest companies in the industry like Coinbase, FTX, and Binance did well during the crash. Also, many BTC holders like Tesla and MicroStrategy have continued to hold their assets.
Another reason why the BTC/USD pair has rebounded is Ethereum. Ether has jumped sharply in the past few days as investors anticipate the upcoming merge that will combine the current version with the Beacon Chain. Indeed, ETH/USD has jumped by more than 80% from its lowest level this year.
The performance of Ethereum is notable because of the close correlation that exists between cryptocurrencies. In most periods, cryptocurrency prices tend to move in sync with each other.
The four-hour chart shows that the BTC/USD pair has been in a strong bullish trend in the past few weeks. This week, the pair managed to move above the important resistance level at 22,610, which was the highest point since July 8th of this year.
Bitcoin also remains above the 25-day and 50-day moving averages while the Relative Strength Index (RSI) has moved close to the overbought level. Therefore, while the bullish trend will continue, the pair will likely pull back and retest the support at 23,000 and then resume the bullish trend.