Bitcoin Price Forecast: BTC traders eye $80k breakout as US Fed says ‘No Recession’

Insights:

Bitcoin (BTC) price continues to consolidate around the $70,000 territory on March 31, as bulls look to stage another breakout in the week ahead. On–chain data shows that recent statements from US Fed Chairman, Jerome Powell has sparked an instant positive reaction among BTC traders.

What are the chance of BTC price staging a breakout above $75,000 in the week ahead ?

Bitcoin Bull increased leverage by 100% after Jerome Powell statement

Bitcoin price peaked at $70,763 within the daily timeframe on March 31, on course to end the month with 17% gains. However, a recent statement from US Fed chairman Jerome Powell has raised optimism among BTC traders, a move that could spark a positive start to April 2024.

On Friday March 29, Fed Chair Jerome Powelltold reporter there is “no reason” to think that the risks of a U.S. recession are elevated.

There is no reason to think the economy is in a recession or the edge of one (a recession). We are at a place where the economy is strong. The labor market is at a good place.

-Jerome Powell, March 29, 2024.

Almost instantly, Bitcoin speculative traders have reacted positively to Jerome Powell’s bullish comment, according recent market data.

CryptoQuant’ Funding rate metric tracks fees paid between active LONG position holders and SHORT traders. It essentially provides insights on the dominant market sentiment as well as the market participation rate.

 

Within 48 hours on Powell’s statement, there has been increased bullish activity among BTC LONG traders. As indicated in the chart above, Bitcoin funding rate surged 100% from 0.03% on March 29, to 0.06% at the time of writing on March 31.

An increase in positive funding rate essentially means that LONG traders are now paying higher fees to SHORT position holders to keep their contracts open.

This occurs when LONG traders are confident of an imminent price surge, which could see them book outsized profits, as evidenced by their preference to take on more leverage.

BTC Price Forecast: All Eyes on $80,000 target

At the time of writing, BTC has maintained an average price of $70,200 over the last 72-hours. This means that the bullish speculative traders raising funding rates now have their sights set on a potential Bitcoin price breakout towards $75,000 following Fed Chair Jerome Powell’ confident statement cooling fears of a 2024 recession.

To validate this optimistic Bitcoin price forecast, bull must establish a steady support base above the previous peak of $73,900.

According to IntoTheBlock’s in/out of the money data, BTC price faces a looming sell-wall at the $72,500 area.  As seen above, 105,820 addresses had bought 105,670 BTC the last time price crossed $73,000 earlier in the month.

If a huge chunk of those holders opt to exit once they break even, BTC price could struggle to advance towards $75,000. But if the bullish traders raising funding rates derivatives markets trigger a sustained wave of spot buying, Bitcoin price could surge towards new peaks closer to $80,000.

However, in the event of a market downturn, the $68,400 territory could offer a major short-term support.