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Bitcoin Price Forecast Amidst 6.4% Crypto Market Slump

Bitcoin's recent price drop, with BTC hovering around $57,280 and hitting an intraday low of $56,750
May 1, 2024

Bitcoin's recent price fluctuations have stirred up uncertainty in the cryptocurrency market, particularly with the current three-day decline. Hovering around $57,280, with a daily low of $56,750, Bitcoin's performance is somewhat underwhelming, coinciding with a broader downturn in the global crypto market, which is currently valued at $2.22 trillion.

The cryptocurrency's recent dip is attributed to concerns about the upcoming Federal Reserve interest rate decision. Investors are apprehensive about the potential impact of the Federal Reserve's (Fed) stance on cryptocurrency investments.

Bitcoin's Decline Pre-FOMC Meeting Amidst USD Strength

In the run-up to the Federal Open Market Committee (FOMC) meeting, Bitcoin has experienced a decline over the past three days, as investors brace for a potentially hawkish stance from the Federal Reserve (Fed). The Fed's policy committee is anticipated to maintain a cautious and gradual approach towards interest rate reduction in 2024. However, much attention is directed towards the Fed's plans regarding its balance sheet.

According to the CME FedWatch Tool, there's only a 4.4% chance of a rate cut, with 95.6% of observers expecting rates to remain steady between 525 and 550 basis points. The FOMC will conclude its two-day April policy meeting today and announce its decision at 2 p.m. Eastern Time. Fed Chairman Jerome Powell is expected to hold a press conference at 2:30 p.m. Futures markets have largely factored in the likelihood of no changes to interest rates during this meeting.

Bitcoin, currently trading around $56,500, has dropped over 7% in the last 24 hours amid renewed economic uncertainties. Investor sentiment seems to lean towards the Fed refraining from rate cuts this year, which could adversely affect assets like cryptocurrencies. The US dollar has strengthened, fueled by positive Employment Cost Index data and indications from Fed officials suggesting no immediate need for rate cuts. This has increased pressure on BTC prices and the overall crypto market.

Bitcoin Price Prediction

Bitcoin (BTC/USD) has seen a significant downturn, now priced at $57,332, reflecting a 6.4% decrease. Key price levels and indicators play a critical role in the technical landscape. Currently, the pivot point is at $59,008, with immediate resistance at $61,569, followed by further hurdles at $64,654 and $67,084.

On the downside, support levels are at $55,051, $53,072, and $51,035.

Significant indicators include an oversold Relative Strength Index (RSI) at 25, suggesting a potential reversal, and the 50-Day Exponential Moving Average (50 EMA) positioned at $63,473, possibly acting as resistance.

Below the pivotal level of $59,008, the outlook remains bearish. A breakthrough could indicate a shift towards a more bullish sentiment, while a failure might reinforce the current bearish bias. Traders should monitor these levels closely for strategic decision-making.

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