Bitcoin $30K Bet Greets FOMC as Analyst Warns of Long Liquidations
Bitcoin (BTC) may ‘take out shorts’ to break $30,000 amid today’s key US macroeconomic updates, analysis says.
As bets pile up on how BTC’s price will react to the Federal Reserve’s decision on interest rates, $30,000 is in sight – but a drop below $20,000 is not off the table.
Trader plans profit taking of $30,000
Bitcoin is hours away from popular trader Crypto Tony conversations “one of the most anticipated” Fed meetings ever.
The Federal Open Market Committee (FOMC) will decide how to adjust key interest rates on March 22, amid suspicions that the ongoing US banking crisis has disrupted policy.
From ongoing rate hike forecasts just last month, markets are now assessing the chances that the Fed will pause the cycle, data from CME Group’s FedWatch Tool show.
This would be a major boon for risk assets, as the Fed would tacitly suggest that the 18 months it has spent draining liquidity from the economy has not been a bullet to recover from.
Liquidity is already on the rise thanks to multiple bank failures, Cointelegraph reported, with some of the quantitative easing (QT) removals undone in a single week.
“Saw the FOMC today which means one thing, VOLATILITY. No doubt we will trend sideways using the meeting, which means tread carefully,” says Crypto Tony told Twitter followers in comments on the day.
“My main bet is to take the $30,000 profit if it comes.”
Market commentator Tedtalksmacro, meanwhile, laid out the probabilities of each Fed path and the likely impact on risk assets.
“Bitcoin’s slow upward slide means my eyes remain focused on $28,700,” Cointelegraph contributor Michaël van de Poppe, founder and CEO of trading firm Eight, continued.
“I expect us to sweep into the high around the FOMC and then we’ll have some consolidation. CME gap at $28,700 as well.”
Van de Poppe was referring to a so-called “gap” in CME Group’s Bitcoin futures markets that formed when the price began a new trading week in a different position than it ended the previous week. Historically, the spot price has gone up or down to “fill” such gaps.
The gap in focus was created in June 2022, data from TradingView confirms.
“Do you really want to go bullish?”
Taking a more conservative view, however, popular analyst Justin Bennett warned that the current spot price represents significant historical resistance.
Related: Bitcoin hits new 9-month highs above $28K as markets flip-flop over FOMC
A “squeeze” of shorts could see $30,000 emerge, he acknowledged, but a sudden dive could have the opposite effect, with longs betting at least $20,000 to hold.
“Look, maybe we’ll see BTC take out short liquidations up to $30k,” Bennett in summary.
“But do you really want to get bullish on macro resistance with a massive block of long liquidations under $20k? I don’t.”
An accompanying chart showed the extent of liquidations triggered by such a move below the $20,000 mark.
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