Is Bitcoin price bouncing at 57K? Here's why these levels are key
Bitcoin (BTC) held near two-month lows at the May 1 Wall Street open as risk assets braced themselves for the next United States macro move.
Bitcoin volatility cools into FOMC
Data from Cointelegraph Markets Pro and TradingView followed skittish BTC price action hours after new lows of $56,500 on Bitstamp.
Traders remained on edge across risk assets ahead of the Federal Reserve’s next interest rates announcement and subsequent press conference from Chair Jerome Powell.
After the Quarterly Refunding Announcement, or QRA, dealt a blow to the U.S. liquidity outlook, market participants hoped that Powell’s tone after the Federal Open Market Committee (FOMC) meeting would not lean too hawkish.
“The FOMC statement and Powell presser this afternoon are likely to confirm USD money market pricing of a much more tepid policy normalization cycle,” Darius Dale, founder and CEO of risk management firm 42 Macro, wrote in part of a digest on X (formerly Twitter).
“As much as Chair Powell would prefer to play up ‘two-sided risks to the economic outlook’, the reality is the preponderance of evidence supports the ‘no landing’ scenario as the highest probability outcome. As such, ‘higher for longer’ is likely to be the dominant message today.”
The latest data from CME Group’s FedWatch Tool underscored the lackluster expectations for good news, with the odds of the Fed holding rates at their current levels at 99%.
Striking a more optimistic tone, popular trader CrypNuevo suggested that the worst Bitcoin and altcoin losses were likely complete.
“BTC really dropped hard and this reinforces the idea that whatever Jerome Powell has to say today, it’s likely priced-in,” he told X subscribers.
“Will we get a retest of the range lows?”
In the latest edition of its London & New York Daily Color market updates sent to Telegram channel subscribers, meanwhile, trading firm QCP Capital referenced both Powell and the QRA as potentially holding surprises for risk-on sentiment.
“There are two important events happening today that could either exacerbate this bearish move or reverse it,” it stated.
“Firstly, if Powell is dovish at FOMC, it could provide a bullish flip. Secondly, if the QRA (Quarterly Refunding Announcement) sees heavy issuances in US bills (front-end) instead of the 10-year (back-end) it would reduce fears of longer-term rates spiking and might put some brakes on the USD rally.”
BTC price in „typical“ bull market retrace
Bitcoin traders thus eyed important BTC price levels to watch after multiple lines in the sand fell through.
Related: Why is Bitcoin price down today?
“This current Bitcoin retrace is slowly turning into an almost 50-day retrace,” popular trader and analyst Rekt Capital revealed on the day.
An accompanying chart compared BTC price pullbacks throughout the bull market which began in early 2023.
Rekt Capital described the latest downside move, coming in at over 20%, as “typical” within this context.
“Typical retraces have been 2-3 weeks, longer ones up to 2 months,” he noted.
Filbfilb, co-founder of trading suite DecenTrader, meanwhile forecast a possible Bitcoin renaissance following in the footsteps of gold in recent years.
“I think we can go lower than on that chart, but if its bullish over the next months it might happen like this as a general idea,” he wrote in an X thread while comparing the two assets.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
