The price of Bitcoin, the largest cryptocurrency by market cap exploded higher during the session past $41,000. Amid the FED rate increase, BTC remains undeterred on its rebound journey to overcome the $42,000 support turned resistance. BTC/USD has generated positive traction-off the moving average (MA 50), which borders the horizontal level of $40,000. This might spur a 2nd-day rally in the pair as Bitcoin surges on improved risk sentiment. At the time of analysis, the no.1 crypto is hovering at $41,143 after gaining above 5% in 24 hours. The Federal Reserve raised short-term interest rates by a quarter of a percentage point (25 basis points) at the end of its two-day meeting on Wednesday, as widely predicted. This is the first-rate increase since last year. The Fed is under increasing pressure to keep consumer prices under control as inflation rises. The unprecedented pandemic-era stimulus package boosted risk assets like Bitcoin. However, to bring inflation under control, the Fed is currently actively reducing its assistance.
Key Levels
Resistance Levels: $47,000, $45,000, $42,000
Support Levels: $37,000, $35,000, $32,000
BTC/USD Daily ChartBTC began an upward rise against the U.S dollar over the $40,000 barrier level. BTC/USD pair moved into a positive zone after trading above the moving average (MA 50). The pair has reached a daily high near $41,717 and is now holding gains. As seen on the daily chart, immediate support is near $39,000 with a connected bullish MA 50 line.
The next support is near the $38,000 level, below which further losses are possible. In the aforementioned scenario, the pair might drop to $37,000. On the upside, the $42,000 level serves as immediate resistance. If the price breaks through the $42,000 resistance, it might move towards $43,000. Near the $45,000, is the next resistance.
BTC/USD 4-Hour ChartOn the 4-hour chart, the price remains above the short-term moving average (MA 50 and MA 200) diagonal and horizontal support respectively. Also, the BTC/USD might maintain its positive tone. A break over the $42,000-$43,000 resistance level could bolster the pair’s bullish outlook, while a drop below the $40,000 could indicate bearish pressures return.
If there is no upside break over $42,000, the pair may begin to correct to the downside. Near the $40,000 level, there is some initial support. Near the $39,000 level, the first support exists. The next support zone is around $37,000. A successful break below the $37,000 support level could signal the start of a significant fall. In this event, BTC/USD might return to $35,000.
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