Bitcoin (BTC), which was a new spike of $40,000 that ended in minutes, tested the nerves of traders on March 16.
BTC/USD 1-hour candle charts (Bitstamp). Source: TradingView
After an abrupt $41,700 trip, shorts feel the heat.
Data from TradingView and Cointelegraph Markets Pro showed that BTC/USD surged to $41,700 on Bitstamp, before immediately reversing.
The market rose by $2,000 in two hours, broke significant resistance levels, and then fell back to its original level.
Although the move was commonplace in recent years, it did not come without its pitfalls, as demonstrated by liquidations across different exchanges.
Coinglass data shows that Bitcoin was responsible for $98 Million of these transactions in the 24 hours prior to this writing. The total crypto liquidations during the period was just over $200 millions.
Chart of crypto liquidations. Source: Coinglass
BTC/USD was still trading in the middle its established trading range. However, resistance at $40,000 and $41,000 were set before the latter became more powerful after the pair deflated.
While $41,000 was the selling pressure on Wednesday, a substantial buildup of sellers did not reappear at $40,000 according to data from Binance’s orderbook, which was compiled by Material Indicators.
BTC/USD orderbook chart (Binance). Source: Material Indicators
“Snooze party”, until Fed rate increase announcement
Analysts, however, saw the immediate past as less important than what Wednesday’s immediate future would bring.
Related: Bitcoin risk final ‘bear-market capitulation’ as wealthy investors continue BTC saleoff — analyst
The United States Federal Reserve will announce interest rate moves at 2pm Eastern Time. This is something many are eagerly anticipating as a possible price paradigm shifter.
Crypto Ed, a popular analyst and trader, was not able to see the news until it came.
Update on #BTC from yesterday’s video. The red box has been a little overexposed, but it is still within the range. Now, back to the snooze party until FOMC? Subscribe here for next video: https://t.co/Lb3xLQhOYu pic.twitter.com/uelS3QPgLv
— Ed_NL (@Crypto_Ed_NL), March 16, 2022
PlanC, a Twitter account, argued that the market had already predicted the expected 0.25% rate rise but that this would not affect macro inflationary forces which are arguably promoting BTC as a store-of-value.
The account summary reads: “The FED will increase rates 25 basis points which is already priced into and will not do anything to stop inflation.”
The BTC/USD exchange rate was at $39,500 as of Tuesday’s writing.
Eileen Wilson –Technology and Energy
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