Crypto market flipped green after the FED interest rate hike of 0.75%, Bull Trap or Not?

in #hive-1679222 years ago

Yesterday was the Federal Open Market Committee (FOMC) meeting, which is one of the most important meetings in the United States as it determines the monetary policy for the United States, the result of the FOMC meeting made the Crypto and Stocks markets blow up like crazy yesterday after the Federal Reserves (FED) hiked the interest rate by 75 basis points to clamp down on surging inflation in the United States, it was nice to see the crypto market react to the news the way it did but at the same time it important that we don't lose focus and get carried away by the current pump just yet, it did the same thing the last time and still dropped after so I am still watching the crypto market closely for now.

Tutorial Youtube Thumbnail Make Money - 2022-07-28T165016.137.png

Effect Of The FOMC Meeting Results On The Crypto Market

Before the Federal Open Market Committee (FOMC) meeting result was announced the Bitcoin market was crashing down and was struggling between the $21k level and the $20k, on the chart below, you will see that it was struggling on the white trendline I drew some weeks ago, which means the trendline held beautifully, although, below the trendline, there is a lot of liquidity to be cleared including pending and stop order just sitting below it, which is why I think that Bitcoin will still retest the $18k level to clear up those liquidities before the bull run starts properly but that aside and speaking of yesterday FOMC news event and how it impacted the crypto.

TradingView_Screenshot_1659018696563.jpg

Before the news hit Bitcoin was struggling and as soon as the news of the FED raising the interest rate by 0.75%, which is the most aggressive increase since 1994, Bitcoin lit up and started pumping and eventually closed yesterday with a big bullish candle, I guess today most crypto traders will be disappointed at first when the market dropped earlier in the day because they thought the bulls are back once again and the Bitcoin pump will continue today which it did eventually, but let's not start buying mansions in our head yet, bitcoin price is still playing around the key resistance level and anything can happen. because it is still pumping now doesn't mean it can not fall back below the key resistance level between $21k and $23k, so until the price break through the $25k level and stay above it, I will just be watching the market because I still don't trust the pump fully as the price of Bitcoin has gotten rejected by the key resistance several times, you can see that in the chart above.

So to answer my question asked, the fact that the Bitcoin price is still pumping now does not mean the daily candle will close bullish or close above the key resistance level. So for now the pump yesterday and today could be a possible bull trap, depending on if the price of Bitcoin closes below the key resistance level and there is still a lot of liquidity at the $18k level, what do you think is it a bull trap or not? leave a comment below let's share ideas.

THANKS GUYS FOR READING MY POST.

PLEASE FOLLOW ME ON:
Discord: onwugbenuvictor#3447
Twitter: @VictorOnwugbenu

Posted Using LeoFinance Beta

Sort:  


The rewards earned on this comment will go directly to the people( @onwugbenuvictor ) sharing the post on Twitter as long as they are registered with @poshtoken. Sign up at https://hiveposh.com.

The aggressive raise has been priced in for a while. That was fully expected. There was cautious trading in the days leading to the fed announcement in case there was a negative surprise. No negative surprise meant rally back to a few days ago highs. However, what really pushed the rally was the language that said they may back off these aggressive hikes sooner than later. This is the first dovish language we've seen and to the market, that means everything. The fed minutes are going to be really important when they come out.

Those who held their short positions and didn't close them before the FOMC news came out must have been rekted already, but I still don't trust the pump.

Posted Using LeoFinance Beta

Definitely one of those lock in your profits if you have them type rallies because anything is possible. The market certainly isn't signaling that its time to buy with both hands but I'm impressed that we didn't get a day two reversal like we usually do. I'll be watching Apple tomorrow to see if they give back their after hours rally. If they keep going up, its a great sign. Still, a single overly comment from a fed governor could derail the rally.