Breathless – The $20,000 is resisting the onslaught of the US Federal Reserve (FED). Bitcoin (BTC) price recovers from a day in the red as this indicator bolsters hopes of a long bull run.
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$20,000 retest after Fed pressure
Bitcoin price falls as low as $20,073 on Bitfinex today, November 3, 2022. Cryptocurrency is trading at $20,251 at the time of writing this article. Its price is currently recording a daily mini-gain of 0.31%.
For now, Bitcoin appears to have successfully retested support around $20,000, following the announcements from the US Federal Reserve of a 75 basis point interest rate hike for this month.
The cryptocurrency thus remains in this macro-range from the $20,000-$23,300 where Bitcoin came back after the October close.
What about hopes for an upcoming 50 basis point hike?
While the FED indicated yesterday, November 2, 2022, that it was raising the target range for the federal funds rate to 3.75% – 4%, data provided by the CME FedWatch Tool shows that the likelihood of an upcoming hike at 4.25% – 4.50% is currently 47.2%versus 52.8% for the range of 4.50% – 4.75%.
The markets are therefore much more betting on another 75 basis point hike, rather than a 50 basis point increase. This second scenario could however change the macro environment in favor of Bitcoin.
Bitcoin Price Ready for Further Highs in the Face of Exhausted Sellers?
On-chain data provides clues as to the potential direction of Bitcoin’s next moves. Glassnode has published a graph which shows that the constant burnout of sellers hit its lowest level since November 2018.
This constant is an indicator that reaches relatively low levels, “when volatility is low, but realized on-chain losses are high”.
Glassnode points out that when this indicator has reached levels similar to its current level in the past, in six out of seven cases, a seller exhaustion constant this low preceded “ upward volatility “.
Bitcoin manages to hold above a crucial zone. After this FED announcement, is the cryptocurrency ready to reattack resistance around the 100-day moving average, around $20,745?
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