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After five consecutive weeks of decline, Bitcoin (BTC) showed signs of reversal today by registering the highest single-day gain since March. BTC climbed by 5% to tease the $40,000 level once again. The renewed optimism in the markets seems to have stemmed from a dovish stance by the U.S. Federal Reserve. The Fed raised interest rates by 0.5% yesterday post the Federal Open Market Committee (FOMC) meeting. Though the news has been priced into the crypto markets already, market turnaround came only after the Fed chairman’s dovish remark that no aggressive hikes are considered by the FOMC in the future.
In this article, we will briefly take a look at the recent price actions of major crypto assets and short-term outlook for BTC.
BTC had a 28% increase in trade volumes yesterday that helped change the tide above $37,700. Despite the momentary sentiment shift in the crypto market, BTC has failed to break $40,000 resistance. BTC continues to face huge pressure from sellers at moving averages (MA) which act as short-term resistances. Today BTC was turned down near the 20-day exponential MA, currently at $39,600. On the upside, BTC requires a lot of buying momentum to get past all the resistance levels above $40,000. On the downside, the $37,000 region is expected to act as a major support level.
Ethereum (ETH), the second-largest crypto asset, followed suit by registering a 5.7% gain today signaling other altcoins to capitalize on the sentiment shift. However, ETH’s move was not as strong as the market participants expected it to be. ETH was inches away from the crucial $3,000 mark yesterday before going back to $2,900. If ETH were to resume an uptrend, the 100-day exponential MA at $3,050 needs to be reclaimed first. The major support for ETH will come down to $2,710. ETH is currently trading at $2,930.
Among the top 20 crypto assets, Tron (TRX) was the biggest gainer in the last 24 hours by raking in 18%. The main factor behind TRX’s performance is the upcoming launch of a decentralized stablecoin named USDD. Additionally, TRON has announced plans to create a TRON DAO reserve that is believed to positively impact the TRX token in the future too.
Meanwhile, Cardano (ADA) and Avalanche (AVAX) booked 10% gains while Polkadot (DOT) and Solana (SOL) gained nearly 7% from the previous day. Zilliqa (ZIL) was another notable gainer in the top 100 list by market cap as it surged 42% on account of the new product roadmap released by their CEO that focuses on metaverse and decentralized finance.
Given the strong impact of the U.S. Dollar action on crypto markets, its brief loss has lent support to the relief rallies experienced by most of the crypto assets. While the Fed has announced less aggressive hikes, it hasn’t ruled them out completely. Interest rate hikes are likely to happen over the course of this year and can negatively impact the crypto ecosystem again. Unless there’s a significant flow of funds into the ecosystem, the chances of a major BTC rally into the crucial $50,000 region remains slim. It is advisable to continue to stay cautiously optimistic about the crypto market now.
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Disclaimer: This article was authored by Giottus Crypto Exchange as a part of a paid partnership with The News Minute. Crypto-asset or cryptocurrency investments are subject to market risks such as volatility and have no guaranteed returns. Please do your own research before investing and seek independent legal/financial advice if you are unsure about the investments.