BTC Bulls Eye a Return to $30,000 on US Stats and Bank Sector News

Key Insights:

• On Wednesday, BTC gained 1.25% to end the day at $29,037.
• Banking sector woes and the US Federal Reserve delivered a bullish session.
• The technical indicators turned bullish, signaling a return to sub-$30,000.

On Wednesday, bitcoin (BTC) rose by 1.25%. Following a 2.06% gain on Tuesday, BTC ended the day at $29,937. BTC wrapped up the day at $29,000 for the first time in three sessions.

After a mixed morning, BTC fell to an early afternoon low of $28,129. Steering clear of the First Major Support Level (S1) at $28,091, BTC rose to a session high of $29,282. BTC briefly broke through the First Major Resistance Level (R1) at $29,078 before easing back to end the day at $29,037.

The Federal Reserve and the US Banking Crisis Deliver Support

It was a busy Wednesday session, with US economic indicators and the US Federal Reserve in focus.

Better-than-expected economic indicators tested buyer appetite before the heavily anticipated Fed interest rate decision and press conference.

The ISM Non-Manufacturing PMI rose from 51.2 to 51.9 in April versus a forecasted 51.8. Significantly, the ADP reported a 296k increase in nonfarm employment versus a forecasted 148k. Employment rose by 142k in March.

The Fed delivered a less hawkish interest rate decision. Members voiced willingness to consider hitting the pause button following a tenth consecutive interest rate hike.

While the FOMC Statement took a more dovish tone, Fed Chair Powell delivered uncertainty during the press conference, stating that it was too early to call an end to the monetary policy tightening cycle. The US economic indicators likely contributed to the more hawkish tone.

According to the CME FedWatch Tool, the probability of a 25-basis point June interest rate hike rose from 0% to 17.7% on Wednesday.

The US banking sector woes and US Government wrangling over the contributed debt ceiling contributed to the gains.

The Day Ahead

US economic indicators will influence the afternoon. US jobless claims, unit labor costs, and nonfarm productivity will be in focus. Weak labor market numbers would fuel bets on an end to the Fed monetary policy tightening cycle.

US corporate earnings, the banking sector, and US Government debt ceiling-related news will also move the dial. Big names on the US earnings calendar include Apple (AAPL), ConocoPhillips (COP), Shopify Inc. (SHOP), and Moderna (MRNA).

Investors should also monitor the crypto news wires and track SEC v Ripple case updates and Binance and Coinbase (COIN)-related news. Regulatory activity and US lawmaker chatter will move the dial.

Bitcoin (BTC) Price Action

This morning, BTC was up 0.15% to $29,080. A range-bound start to the day saw BTC rise to an early morning high of $29,114 before easing back.

Technical Indicators

Resistance & Support Levels

BTC needs to avoid the $28,816 pivot to target the First Major Resistance Level (R1) at $29,503. A move through the Wednesday high of $29,282 would signal an extended bullish session. The crypto news wires and the US stats should be crypto-friendly to support an extended rally.

In the event of an extended rally, BTC would likely test the Second Major Resistance Level (R2) at $29,969 and resistance at $30,000. The Third Major Resistance Level (R3) sits at $31,122.

A fall through the pivot would bring the First Major Support Level (S1) at $28,350 into play. However, barring a crypto event-fueled sell-off, BTC should avoid sub-$28,000 and the Second Major Support Level (S2) at $27,663. The Third Major Support Level (S3) sits at $26,510.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was bullish signals. BTC sat above the 100-day EMA ($28,695). The 50-day EMA converged on the 100-day EMA, with the 100-day EMA widening from the 200-day EMA, sending bullish signals.

A bullish cross of the 50-day EMA through the 100-day EMA would support a breakout from R1 ($29,503) to give the bulls a run at R2 ($29,969) and $30,000. However, a fall through the 100-day ($28,695) and 50-day ($29,686) EMAS would bring 200-day EMA ($28,356) and S1 ($28,350) into view. A BTC fall through the 50-day EMA would send a bearish signal.