- Bitcoin price rises on the US dollar weakness.
- Fed rate decision on Sep. 20 will offer further guidance to crypto traders.
- So far, rate pause expectations have kept bullish spirits up.
YEREVAN (CoinChapter.com) — Bitcoin (BTC) finished last week in greens, rising nearly 2.5% to $26,535 as its arch nemesis, the US dollar, underperformed against most foreign currencies. Off late, as CoinChapter has covered, Bitcoin’s profit has been the dollar’s loss — and vice versa.
The ‘situationship’ looks the same this week. Bitcoin kicked off the session with a modest 0.5% gain. On the other hand, the US dollar index, which tracks the greenback’s strength versus a bag of top foreign currencies, is down 0.14%.
In other words, most crypto traders have been positive about SOMETHING. Let’s take a closer look at what’s cooking their bullish bets on Bitcoin this week.
Federal Reserve’s Interest Rate Decision Looms
This week, everything looks centered around the Federal Open Market Committee’s (FOMC) tea-and-biscuit get-togethers on Sep. 19-20. The Federal Reserve officials will decide where to take the interest rates moving forward on the sidelines.
Now, that’s a tough spot for Chairman Jerome Powell and his colleagues. Last week, the US consumer price index (CPI) showed slightly higher prints in the headline and core inflation. However, the core inflation stayed on its downside course versus its July 2022 peak.
That explains why most Wall Street bets remain skewed toward a rate pause this week — almost 99% probability, according to CME. Interestingly, the probability of a rate pause was 97% last week and 93% a week before that.
So that BULLISH SOMETHING for crypto traders is rate pause expectation. But let’s not forget that the Fed will share economic projections for the remainder of 2023, which may include rate hikes.
Bitcoin Price Targets For This Week
The rate pause expectations may drive Bitcoin toward a resistance confluence comprising 50-day (the red wave) and 200-day (the blue wave) exponential moving averages (EMA) and a multi-month descending trendline.
The confluence sits around $27,000, up about 1.5% from current price levels.
Conversely, the market can expect a “sell-the-news” pullback after the Sep. 20 rate decision, bringing the focus back on the horizontal trendline support near $25,650.