ATTENTION, Bitcoin Traders! BTC’s next rise may depend on this crucial factor
Bitcoin [BTC] Traders have found themselves in a nail-biting situation this week after the downside of the past seven days. The bearish performance sent BTC crashing, and at press time, the crypto king stood in a critical zone of short-term support. Its direction from this point was at the mercy of the FOMC meeting.
Bitcoin sat on its short-term support with a price tag of $19,004 at press time. However, performance over the next 24 hours will have changed drastically depending on the outcome of the FOMC meeting. The latter is expected to have an interest rate revision by the Federal Fund in the USA. This will affect investor sentiment, as has been the case in the past.
Current estimates favor an increase of 0.5% or 0.75%. The latter will trigger stronger bullish sentiment for BTC, while the former will support a range-bound performance. This was the case according to diagram which provides a guide or estimates the potential outcome based on federal rate data.
Source: Twitter
Although current sentiment was strong for a rate of 0.5% to 0.75%, a 1% rate hike could still be a possibility. An interest rate of 1% is expected to trigger bearish sentiment. However, the resulting downside could push BTC towards the $17,600 price range.
Furthermore, calculations on the chain highlighted an uncertainty as investors await the critical FOMC decision. The hibernation calculation indicated that the hibernation state dropped significantly during the last 30 days. At press time, it was near its monthly lows, which is not surprising as investors are waiting to see how the market will react.
Source: Glassnode
The hibernation reflected whale activity especially from around the middle of the month. Addresses with more than 1000 BTC dropped significantly from September 15th. However, outflows from these addresses have also slowed since 18 September. This result reflected the uncertainty surrounding the FOMC meeting and the impact of the announced rate.
Source: Glassnode
Loads the gun
The possible outcome could be another sharp rise or a small fall. Addresses that have already sold will most likely take advantage and begin to accumulate, especially if there will be an additional disadvantage. This result could potentially provide a softer landing, hence a limited disadvantage.
On the other hand, a favorable outcome from the FOMC could trigger a strong buy signal especially from the whales. Such an outcome could support a strong recovery towards the end of the week.
Thus, the outcome of the FOMC meeting will give a rough idea of how the Federal Reserve has done when it comes to fighting inflation. A positive outcome could ease the selling pressure on Bitcoin and the higher-risk asset class in general.
