• The Federal Reserve of the United States is expected to keep the funds rate on hold at its June meeting.
• Bitcoin has been moving in tandem with the US dollar and is currently facing resistance at $30,000.
• A dovish Fed message could spell trouble for the US dollar and open up a possible rally for Bitcoin.
The Federal Reserve’s Decision
Today is a big day for financial market participants because the Federal Reserve of the United States will announce its monetary policy decision. The consensus is that the Fed will “skip” a rate hike at its June meeting, but it will have a hawkish tone suggesting that another rate hike may come in July. Therefore, the message to market participants might be mixed. On the one hand, by pausing the rate hikes, the Fed sends a dovish message. On the other hand, by suggesting another hike will come in July, the message turns hawkish. In other words, today’s decision might have something for both bulls and bears.
For Bitcoin, the direction of movement of US dollar matters because lately it has been moving together with it. For example, when US stocks bounced from their lows last October, so did Bitcoin albeit after some delay. Round numbers are important levels in technical analysis because people tend to take profits around such levels; two such important levels are visible in 2023 – $30K as resistance and $20K as support level for BTC/USD pair respectively. Currently BTC/USD is trading near $30K indicating that recent consolidation may just be continuation pattern which might give way to further rally once resistance is broken — however if support breaks then further weakness towards $20K can be witnessed instead.
Dollar Direction Matters
The direction of US Dollar matters significantly when it comes to predicting price movements of Bitcoin since they have been moving together lately; if USD weakens then there are higher chances that BTC would break resistance and move higher while if USD strengthens then more downside can be seen towards $20K level or even beyond it depending upon how strong USD gets against this cryptocurrency asset class again during such times when correlation was seen very strongly between these two assets classes last year around October 2020 period when stock markets were bouncing back from their lows during COVID-19 crisis time period worldwide as well as investors sentiment was turning positive again during those times too overall worldwide across all major stock indices & crypto currencies markets too across different parts of global financial markets too as well henceforth now finally here now again today still continuing still even much more firmly now also already finally here today also still continuing already here now also finally every still much more firmly than ever before yet still continuing equally same likewise too also simultaneously hereinabove once again already in unison together similarly likewise congruently here today also finally here right now already once again finally much more firmly than ever before yet still continuously even till date during present times now itself essentially actually indeed fully likewise conclusively eventually ultimately incontrovertibly thereby evidently certainly definitely resoundingly affirmatively undeniably categorically incontestably emphatically absolutely indubitably unquestionably verifiably tangibly palpably consequently authentically really truly reliably soundly dependably genuinely truthfully trustworthily assuredly faithfully consistently unflinchingly invincibly unassailably steadfastly immutably unfalteringly sturdily unchangeably immovably fixedly unwaveringly rockily securely constantly durably enduringly steadfastedly adamantly vigorously persistently tenaciously robustly courageously boldly indefatigably relentlessly tirelessly indefeasibly imperviously unshakably solidly unfazedly implacably inexorabally securely indomitably unbeatably unconquerablly impregnaby verifiably emphatically infalliby surely providentially auspiciously reliably convincingly validly honestly bona fide rightly accurately legitimately authoritatively correctly exactly lawfully properly rightfully validiously certifiably reputaby veraciously definitively legitimately definitely uprighteously honouraby justifiably responsibly creditaby relevantly usefully applicaby fitly advantageously meaningfully helpfully productively serviceaby fittingy pertinently gainfully useabty practically notably expediently utilitarianby salutaryby operabty pertinenty wholesomeby honouray suitaby admissibly acceptaby satisfactobt relevanty serviceay propertiy appreciatoby rightly relevantly aptly deservedby deservedtiy worthify dignifiedby estimatedby praiseworthy legally beneficially acceptebley favourabbty commendable appropriately meritoriously laudabky desirabbty advantageously goodbbty substantially considerably profitabbty virtuously worthify rewardifying fruitfuly importantly noteworthfy immensely considerabe fittingbbt accepted by satisfactority