Bitcoin price drops to $67k following rate cut updates.
FUNDAMENTAL OVERVIEW:
Bitcoin price fell on Thursday during a volatile session, as the Federal Reserve’s forecast of prolonged high interest rates overshadowed signs of easing near-term inflation.
Bitcoin remains range-bound as the Fed forecasts only one rate cut this year. Traders are largely cautious towards Bitcoin and other cryptocurrencies due to the prospect of prolonged high U.S. interest rates.
While the Fed kept rates unchanged on Wednesday, Chair Jerome Powell indicated only one possible rate cut this year, down from the previously expected three cuts. Several policymakers also suggested no rate cuts this year, emphasizing the need for more progress in reducing inflation. The Fed also raised its inflation forecast for the year.
Earlier on Wednesday, data showed U.S. consumer inflation eased slightly more than expected in May. Bitcoin initially saw gains following the inflation data but lost ground after the Fed’s comments.
High rates negatively impact speculative assets like cryptocurrencies by limiting available liquidity for investment. Despite data showing some institutional crypto investment, token prices have not significantly reflected this influx.
BITCOIN TECHNICAL ANALYSIS DAILY CHART:
Technical Overview:
Bitcoin is currently trading within a down channel.
Bitcoin is positioned below all the Moving Averages (SMA).
The Relative Strength Index (RSI) is in a Neutral zone, while the Stochastic oscillator suggests a Negative trend.
Immediate Resistance level: 68418.54
Immediate support level: 67195.25
HOW TO TRADE BITCOIN
After an initial rise, Bitcoin began consolidating within a significant range. Currently, Bitcoin has formed a bearish engulfing pattern at the resistance zone and is pushing lower. It has also formed a double top and is trading around the neckline, which is acting as support. If this support zone breaks, a further decline is possible.