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BTC Bears to Target Sub-$29,500 on a Hawkish Fed and Binance Woes

By:
Bob Mason
Published: Jun 29, 2023, 00:45 UTC

BTC found support this morning. However, central bank monetary policy and regulatory scrutiny remain headwinds ahead of the SEC v Ripple ruling.

BTC turns bullish on institutional activity - FX Empire

In this article:

Key Insights:

  • On Wednesday, BTC resumed the current week’s downtrend, falling 1.91% to end the day at $30,184.
  • Fed Chair Powell and the crypto news wires weighed on BTC and the broader crypto market.
  • However, the technical indicators remain bullish, signaling a return to $32,500.

On Wednesday, bitcoin (BTC) fell by 1.91%. Reversing a 1.44% gain from Tuesday, BTC ended the day at $30,184. Significantly, BTC revisited sub-$30,000 for the second time in five sessions.

A mixed start to the day saw BTC rise to a first-hour high of $30,792. Falling short of the First Major Resistance Level (R1) at $31,141, BTC fell to an early evening low of $29,957. BTC fell through the First Major Support Level (S1) at $30,345 to wrap up the day at $30,184.

Fed Chair Powell and Binance-Related News Weighed

It was a quieter Wednesday session on the US economic calendar. There were no US economic indicators for investors to consider. However, Fed Chair Powell delivered a hawkish speech at the ECB central bank forum to test buyer appetite. Powell said consecutive interest rate hikes remained on the table, cementing bets on a July Fed rate hike.

Despite the hawkish chatter, the NASDAQ Composite Index bucked the broader market trend, rising by 0.27%. A modest increase in the chances of a September 25-basis point interest rate hike to take the Fed Funds Rate to 5.75% limited the damage.

According to the CME FedWatch Tool, the probability of a 25-basis point July Fed rate hike stood at 81.8% versus 76.9% on Tuesday. Significantly, the chances of the Fed lifting rates to 5.75% in September stood at 16.4%, up from 15.4% on Tuesday.

The crypto news wires added to the bearish mood, with Binance facing more scrutiny. The news hit the wires on Wednesday of Paysafe Payment Solutions Limited, Binance’s EUR banking partner, ending services on September 25.

Binance has faced increased scrutiny in Europe since the SEC filed charges against Binance.US, Binance, and Binance CEO CZ.

The Day Ahead

It is a busier Thursday, with US GDP and jobless claims in focus. Barring an unexpected spike in US jobless claims, the stats are unlikely to have a material impact on BTC and the broader market. The markets expect a July rate hike, and bets on a second move in September are also rising.

Ahead of the US session, Fed Chair Powell will speak again from the ECB Central Bank Forum. While the Fed Chair will draw interest, investors should monitor the crypto news wires for SEC v Ripple case-related news.

Beyond the SEC v Ripple case, Coinbase (COIN) and Binance-related news will need continued monitoring.

Bitcoin (BTC) Price Action

This morning, BTC was up 0.12% to $30,220. A range-bound start to the day saw BTC fall to an early low of $30,175 before rising to a high of $30,220.

BTC finds early support.
BTCUSD 290623 Daily Chart

BTC Technical Indicators

Looking at the EMAs and the 4-hourly candlestick chart (below), the EMAs sent bullish signals. BTC sat above the 50-day EMA ($29,889). The 50-day EMA pulled further away from the 100-day EMA, with the 100-day EMA widening from the 200-day EMA, sending bullish signals.

A hold above the 50-day EMA ($29,889) would support a move through R1 ($30,665) to give the bulls a run at R2 ($31,146). However, a fall through the 50-day EMA ($29,889) and S1 ($29,830) would bring S2 ($29,476) into view. A fall through the 50-day EMA would send a bearish signal.

EMAs remain bullish.
BTCUSD 290623 4 Hourly Chart

Resistance & Support Levels

R1 – $ 30,665 S1 – $ 29,830
R2 – $ 31,146 S2 – $ 29,476
R3 – $ 31,981 S3 – $ 28,641

 

About the Author

Bob Masonauthor

With over 20 years of experience in the finance industry, Bob has been managing regional teams across Europe and Asia and focusing on analytics across both corporate and financial institutions. Currently he is covering developments relating to the financial markets, including currencies, commodities, alternative asset classes, and global equities.

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