Bullish view
- Buy the BTC/USD pair and set a take-profit at 30,500.
- Add a stop-loss at 27,500.
- Timeline: 1-2 days.
Bearish view
- Set a sell-stop at 28,500 and a take-profit at 27,500.
- Add a stop-loss at 30,000.
The BTC/USD pair remained stuck in a tight range below the resistance point at 30,000 as regional banks stabilized and as US stocks surged. Bitcoin was trading at 29,000 on Monday morning, where it has been in the past few weeks.
Regional banks and Federal Reserve
Bitcoin and gold have recently reacted positively to the situation in the regional banks in the US. Gold jumped to a record high while Bitcoin briefly retested the important resistance point at $30,000. This happened after First Republic Bank collapsed on Monday. Other banks like Comerica and Western Alliance also came on the verge of collapse.
On Friday, most bank stocks jumped sharply, with PacWest and Western Alliance shares soaring by more than 50%. This happened as investors remained optimistic that these banks will survive. However, there is a likelihood that this rebound is temporary since companies remain at risk.
Bitcoin also reacted mildly to the latest interest rate decision by the Federal Reserve. In a statement, the Fed decided to hike interest rates by 0.25%, pushing them to the highest point in more than a decade. It is unclear whether the Fed will continue hiking interest rates later this year.
Data published on Friday showed that the American labor market did well in April as it added over 253k jobs. The unemployment rate dropped to 3.4%, the lowest point since 1969 while wage growth remained healthy.
The next key mover for the BTC/USD pair will be the state of the banking sector and how regional banks perform. Bitcoin could remain under pressure if these banks continue doing well this week. Further, the pair will react to the upcoming American consumer and producer price index data scheduled for Wednesday and Thursday.
BTC/USD technical analysis
The BTC/USD pair has been in a consolidation phase in the past few days. As a result, the pair is consolidating at the 25-day and 50-day exponential moving averages (EMA). The MACD has moved to the neutral point.
The pair has also formed what resembles an inverted head and shoulders pattern. Therefore, there is a likelihood that the pair will have a bullish breakout soon. If this happens, the pair will likely have a bullish breakout and retest the key resistance point at 31,000.
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