May 19, 2023
BTC Slides Below $27,000 as Fed Rate Hike Looms
The price of Bitcoin (BTC) dipped below the $27,000 mark on May 19, as analysis showed large-volume trades putting pressure on the cryptocurrency’s price. Data from Cointelegraph Markets Pro and TradingView indicated that BTC/USD had dropped to a low of $26,380 on Bitstamp, before a modest recovery placed the pair back in the range of the previous few days.
The decline in price was largely attributed to increasing market expectations of an interest rate hike by the United States Federal Reserve in June, following the release of positive jobless claims data. In a speech by board member Philip Jefferson at the 2023 International Insurance Forum in Washington, D.C., he noted that while inflation was too high, progress had not yet been made in reducing it.
According to CME Group’s FedWatch Tool, the odds of the Fed pausing its hiking cycle next month had dropped from 95% to 62% on the day. Monitoring resource Material Indicators revealed that owners of bid and ask liquidity had placed trades to manipulate BTC’s price behaviour on short timeframes. They noted that BTC/USD had performed a retest of the 100-day moving average (MA), its third in the past seven days.
Material Indicators commented that the market was pricing in potential for another rate hike in advance of Federal Reserve Chair Jerome Powell’s appearance, scheduled for May 19. They also suggested that the 200-week MA at $26,100 could form a downside support zone.
Traders maintained potential bearish targets, with a focus on a broad area around $25,000. Michaël van de Poppe, founder and CEO of trading firm Eight, identified $27,000 as the key support level now absent from the chart, while popular trader Crypto Tony suggested a long position if BTC/USD could break above $27,500, or a short position if it closed below $26,600.
Trading suite Decentrader noted that the Long/Short ratio was currently above 2, which was very high, and typically needed to be resolved and move lower before bullish sentiment could return. While the market awaits the outcome of Jerome Powell’s speech, traders are advised to keep a close eye on the key support and resistance levels outlined.Disclaimer: All investment or financial opinions expressed by MoonLanding Media are not recommendations and are intended for entertainment purposes only. Do your own research prior to making any kind of investment. This article has been generated based on trending topics, has not been fact checked and may contain incorrect information. Please verify all information before relying on it.