BTCUSD Fundamental Analysis:
The third major financial event of May is coming up, the interest rate meeting and the non-farm payrolls data.
All financial market investors are watching for the speech at the May 2 meeting. If Powell changes his position from the last meeting that "a pause in rate hikes will not be included in this year's benchmark issue" and instead adopts a more dovish tone, then the dollar index will see a sharp drop.
Market data suggests that the probability of the Fed ending the year with rates between 4.25-4.50% has reached 83%, while the probability of ending the year with rates between 4.50-4.75% has dropped to 17%. This data also suggests that the market does not expect the Fed to continue to raise rates significantly at its next meeting, which will provide stronger support for the cryptocurrency market.
The decline in the US dollar index will attract a large number of investors to the US dollar-denominated BTC market.
Technical analysis: From a technical perspective, BTC is currently on the 4H chart of the Elliott Wave push, which has set the stage for the start of the fourth wave. If this pattern is to build a fifth wave, then the key support level of the current structure will move up to the S3 price range. In terms of the medium-term layout, the end of the above-mentioned fifth wave would be at T1 near 31,300, T2 near 34,000, and T3 near 38,300.
If short-term prices fall to S2 and oscillate around the midline, a relatively common triangle pattern could easily form. In the short term, the market is still waiting for the May 2 meeting to land and form a triangle pattern for an upward breakout.
One scenario to keep in mind is that if Powell continues his strongly hawkish tone at the interest rate meeting, the dollar will continue to be supported in the short term. If BTC is influenced by fundamental analysis and falls below the support level of S3, the pattern will be broken and we will consider the whole trend as a head and shoulders bottom pattern. Therefore, a short-term correction may occur during the meeting, but considering that the Fed's continued rate hikes may trigger market fears of recession, speculative products such as cryptocurrencies can still continue to build long positions after the fundamental analysis stabilizes.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.