Bitcoin (BTC) surged past $84,000 on March 19 as investors awaited the US Federal Reserve’s interest-rate decision. The cryptocurrency reached local highs of $84,358 on Bitstamp, according to data from Cointelegraph Markets Pro and TradingView. However, risk assets were on edge ahead of the Federal Open Market Committee (FOMC) meeting, with the Fed expected to maintain steady rates until at least June, as indicated by CME Group’s FedWatch Tool.
Traders were particularly concerned about the comments from Fed Chair Jerome Powell, who already had a hawkish stance. Powell faces pressure from US trade tariffs as inflation markets begin to decline. QCP Capital, a trading firm, stated in a bulletin to Telegram channel subscribers that they expected the Fed to remain in a “wait-and-see” mode due to the uncertain impact of tariffs on the economy.
While Bitcoin held above $80,000 throughout the week, its fate was uncertain as US stocks experienced significant downside. The S&P 500 and Nasdaq Composite Index were down 4% and 8.7% year-to-date, respectively, compared to a 10% decline for BTC/USD. QCP Capital expressed concerns about the lack of meaningful tailwinds to reverse this downward trend.
However, there was a potential silver lining in the form of increasing equities allocation by US retail investors. The Kobeissi Letter, a trading resource, reported that retail net inflows into Nasdaq 100 index stocks had doubled in just a few weeks, with retail investors showing strong interest in popular names like Tesla and Nvidia. This influx of retail investors could potentially offset some of the negative sentiment in the market.
Popular trader and analyst Rekt Capital analyzed BTC price action and hoped that the upside gap in CME’s Bitcoin futures market would be filled with a spike to $87,000. These gaps have historically acted as short-term price magnets. Rekt Capital also noted that Bitcoin had successfully retested the CME Gap as support, indicating a potentially positive trend.
Keith Alan, co-founder of trading resource Material Indicators, suggested that a dovish tone from Powell could have a clear impact on price momentum. A more optimistic outlook from the Fed could push Bitcoin’s price above key moving averages and avert a potential death cross. However, bad news could lead to a retest of multimonth lows at $76,000.
It’s important to note that this article does not provide investment advice or recommendations. Investors should conduct their own research and analysis before making any financial decisions.
