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The pair will likely keep rising as bulls target the next key resistance point at 26,000.
Bullish View
- Buy the BTC/USD pair and set a take-profit at 26,000.
- Add a stop-loss at 22,500.
- Timeline: 2 days.
Bearish View
- Set a sell-stop at 23,800 and a take-profit at 22,000.
- Add a stop-loss at 25,000.
The BTC/USD price made a bullish breakout as demand for cryptocurrencies rose. The pair crossed the important resistance point at 24,000, which was the highest point since July 30th of this year. Bitcoin has recovered by more than 36% from its lowest level this year.
Cryptocurrency Recovery Continues
Bitcoin has had a relatively difficult year as worries of high-interest rates rose. It dropped from last year’s high of almost $70,000 to about $18,000. Recently, however, bitcoin and other cryptocurrencies have staged a strong recovery, bringing their total market cap to over $1.1 trillion.
This recovery has happened at a time when the Federal Reserve has ramped up its rate hikes. The bank hiked interest rate hike by 0.75%, bringing the total year-to-date increase to 225 basis points. Analysts expect that the bank will continue hiking rates this year, especially after the strong US jobs data.
Data by the Bureau of Labor Statistics (BLS) showed that the American economy added over 528k jobs in July. The unemployment rate dropped from 3.6% to 3.5% while wages continued rising. As a result, some Fed officials, including Mary Daly hinted that the bank will hike rates by 0.50% in September.
The next key economic data to watch will be the upcoming US consumer price index (CPI) data. Economists expect the data to reveal that the country’s inflation slipped slightly in July as gasoline prices retreated.
The BTC/USD price also bounced back because of the strong correlation between technology stocks and cryptocurrencies. The Nasdaq 100 index, which is made up of the biggest tech companies, has risen by about 20% from the lowest level this year. This means that the index is exiting the bear market.
BTC/USD Forecast
The four-hour chart shows that the BTC/USD price has been in a strong bullish trend in the past few weeks. The pair has moved above the 25-day and 50-day moving averages. At the same time, the MACD has moved above the neutral point.
Notably, the pair has formed an ascending triangle pattern that is shown in green. In price action analysis, this pattern is usually a bullish sign. It has moved to between the 50% and 38.2% Fibonacci Retracement level.
Therefore, the pair will likely keep rising as bulls target the next key resistance point at 26,000. A drop below the support at 23,000 will invalidate the bullish view.
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