A leading crypto analyst says Bitcoin (BTC) and the rest of the digital asset markets are rebounding on Federal Reserve Chair Jerome Powell’s dovish post-Federal Open Market Committee (FOMC) press conference.
In the latest edition of his Cryptocademy newsletter, analyst Justin Bennett dives into the charts to predict how long BTC, Ethereum (ETH), and FTX Token (FTT) rallies will last.
“Bitcoin has put in an impressive rally today, with a 7% gain as of this newsletter. Of course, most of this came following today’s FOMC.
Now, I know a lot of people are looking to short BTC at resistance, but I think that’s a mistake… my base case has been for a continued rally before the next leg lower.
That said, it’s also not a good time to long BTC with it trading just below $23,000 resistance. It’s going to take a daily close above that to expose $24,200.
Instead, I think it’s better to watch for a retest of the $22,000 area for a potential long opportunity. As long as that holds, I think BTC looks good for an eventual move above $23,000.
If $22,000 fails, expect lower prices like $21,600.”
Bennett thinks Ethereum is about to confirm that its recent sell-off was a fake.
“I like Ethereum higher as long as it holds channel support. However, ETH could also catch a significant bid if we see a retest of the area between $1,515 and $1,530.
I think that’s a really interesting region to keep an eye on over the next few days.
Just keep in mind that the $1,700 region promises to be a massive test for ETH on the way up, so I’d be surprised to see a break above that on the first try.”
Looking at FTT’s big post-FOMC move, Bennett warns that it could be a fakeout.
“FTT just became a lot more interesting with a daily close back above the late May trend line, which is also the neckline of an inverse head and shoulders.
FTT had held above this level for about a week until Monday’s close back below.
However, as I’ve mentioned several times, moves like that before a big event like FOMC can often be fakeouts. This move from FTT is no exception.
Moving forward, I would expect any retest of the $28 area to run into significant demand. Likewise, the area just above $30 is resistance.”
Finally, Bennett looks at the US Dollar Index (DXY), measuring the dollar’s strength against crypto assets. Bennett thinks the DXY could be near-term bullish for digital assets.
“For now, it seems the DXY wants lower, which should continue to be bullish for risk assets in the short term.”
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