The Federal Reserve’s decision on interest rates is a critical economic lever that traditionally influences traditional markets and, as has been seen, the cryptocurrency market as well. An unchanged interest rate could maintain the status quo, possibly keeping investment steady in assets like Bitcoin and Ethereum.
A cut, however, could signal economic caution, potentially reducing the attractiveness of risk assets like cryptocurrencies or, conversely, could lead investors to seek higher returns in the crypto market if traditional investments falter.
BTC/USD Chart by TradingViewAnalyzing the Bitcoin chart, there is a distinctive “war” between the bulls and bears. The immediate resistance level to watch is around the $42,500 mark, which Bitcoin has been testing recently. This level is crucial because a decisive close above it could signal increasing bullish momentum. On the downside, the support level at approximately $39,528, aligning with a psychological round number and a previous area of interest, is one that traders are likely to defend vigorously.
The upcoming Fed decision could serve as a catalyst for Bitcoin’s next big move. If interest rates remain unchanged, Bitcoin could continue to test the resistance level, and a break above could confirm a bullish reversal. However, should rates decrease, Bitcoin’s reaction might be even more unpredictable.
This article was originally published on U.Today
Source: Cryptocurrency - investing.com
