Like most crypto assets, Bitcoin is in green, adding four percent on the last trading day versus the USDT. Trading above $22k, the path of least resistance is proving northward in short to medium term.
Following losses early this week, prices temporarily plunged below $22k before bouncing strongly on July 27 to align with the trend set forth on July 18. The drop to this week’s low completed the retest, highlighting the importance of the current support line at $22k and the middle BB.
Therefore, as BTC inch higher in a buy trend continuation inside a broader rising channel, buyers are upbeat and expect more gains in the short term.
The U.S. FED Rate Hike
The current formation is sparked by fundamental factors. To tame rising inflation, the FED on July 27 said it was hiking interest rates by 0.75 bps to 2.5 percent while reducing its government and mortgage-backed securities holdings.
The central bank cited the ongoing crisis in Ukraine and Russia, which it said was heaping pressure on prices and slowing down economic activity. Even amid this development, it shall continue to deploy its tools to eventually bring down inflation to two percent in the long term. The 0.75 percent bps hike was expected.
However, Jerome Powell’s comment later on when issuing a presser saw Bitcoin and the crypto market rally. In his preview, the current interest regime is broadly at levels the central bank would consider neutral.
Bitcoin Price Analysis
Bitcoin is firm when writing, adding five percent in the past 24 hours. Technically, BTC is in a rising channel and trending higher in a bullish breakout formation above $22k with decent above-average trading volumes pointing to trader participation.
The $22k support serves as the lower bound for traders looking to double down on every dip with targets at $28k in the medium term, tapping on shifting trader sentiment. Risk-on traders can wait for a close above $24.5k registered last week to ramp up with the same target level.
Any unexpected dump below $22k and later July 27 lows will slow down the current advance, possibly forcing Bitcoin to $20k and 2022 lows in a bear trend continuation formation.