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MENAFN- Daily Forex)
Bitcoin initially tried to rally during the trading session on Wednesday, but has given back the gains just a little, as the 50-day EMA has offered a bit of resistance. Above there, we also have the $100,000 level, but this is not a market that I'm looking to short. And in fact, I do believe that it goes higher, given enough time.
We have been consolidating between the $90,000 level and the $110,000 level over the last two and a half months or so. I think that probably continues to be the case. After all, despite the fact that we have pro crypto administration in the White House, the reality is that not much has been done yet. So with that being the case, the market looks as if it is going to continue to hang around in this area waiting for some type of catalyst.
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The Federal Reserve remains very tight with monetary policy and that works against risk assets such as Bitcoin, so part of that will probably continue to be the case. And it's worth noting that inflation is of course running hotter than anticipated and wanted really. So, I think at this point in time the Federal Reserve has quite a bit of influence on Bitcoin despite the fact that and Bitcoin evangelists say that it is decentralized money.
It's not clearly being controlled by Wall Street and monetary policy expectations. So, with that being said, basically what you're waiting for is the Fed to start cutting rates again. They don't look like they're getting ready to nor do they look like they are getting ready to even suggest that they are getting ready to, and I suspect that most Bitcoin traders now are using this as a vehicle to accumulate over time and then eventually it will break out to the upside.
EURUSD Chart by TradingView
If we were to break above the $110,000 level it opens up a move to the $130,000 level based on the measured move of $20,000. The $88,000 level being broken could bring a test of the 200 day EMA but right now that doesn't look like the likeliest of paths.
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