Bitcoin Traders Eye the FOMC Meeting

Overnight, Bitcoin experienced a price dip, briefly sweeping the $56,000 swing low, a scenario mentioned in a previous analysis. After capturing liquidity, Bitcoin saw a strong bounce, ranging between $56,100 and $56,900.

It initially faced rejection during the London and New York Opens, revisiting its earlier lows. However, Bitcoin then broke out with a robust squeeze, briefly touching the February 2021 pivot level.

12-hour time frame analysis

BTCUSD - 12 Hour Time Frame

As the market reacts to recent movements, it’s important to watch how investors respond to this pump. One potential outcome could be a revisit of the lows, allowing for bottom formation just below the mentioned pivot, with the Federal Open Market Committee (FOMC) meeting on September 18th potentially marking a turning point.

Alternatively, Bitcoin could continue trading above the pivot, maintaining resistance until the FOMC meeting, offering a more stable price environment.

For those looking to capitalize on the next major rally targeting $70,000 or beyond, patience is key. With the FOMC meeting approaching in a couple of weeks, Bitcoin may lack the liquidity to push significantly higher until after the 18th.

More favourable trade setups will likely emerge after this date, particularly if Bitcoin breaks out above $62,000, which would provide the fuel needed for a strong rally.

Should Bitcoin move lower before this breakout, it is likely to test a strong support level at $53,000. This could present another good entry opportunity, especially if the 50MA, 100MA, and 200MA bands cross in the correct order on the 1-hour timeframe.

A similar cross occurred when Bitcoin rose from below $60,000 to $65,000, signaling an early trend. However, being a lower timeframe signal, it's important to manage risks as trends may shift quickly.

Is it time to buy Bitcoin?

While Bitcoin’s recent volatility may seem concerning, it presents both short-term and long-term opportunities for investors. With key levels to watch and the FOMC meeting on the horizon, it's important to monitor the market for potential setups that could lead to significant upside.