- Bitcoin’s value finds stability near $84,000 on Thursday, having encountered several rejections near the 200-day EMA.
- The Fed’s recent hawkish comments negatively impact market sentiment for high-risk assets such as Bitcoin.
- On Wednesday, US Bitcoin spot ETFs experienced an outflow of $169.87 million.
As of Thursday, Bitcoin (BTC) is maintaining stability around the $84,000 mark after meeting resistance at the 200-day Exponential Moving Average (EMA), which is at $85,000, since last Saturday. Despite the risk-averse atmosphere triggered by the hawkish statements from the US Federal Reserve on Wednesday, BTC has shown relative stability. However, there is noticeable weakness in institutional demand, as Bitcoin spot Exchange Traded Funds (ETFs) marked a net outflow of nearly $170 million on Wednesday.
Bitcoin demonstrates resilience amidst hawkish Fed commentary
During Thursday’s European trading hours, Bitcoin holds steady above $84,000, despite comments from Fed Chair Jerome Powell that conveyed a hawkish outlook on Wednesday.
Referencing a report by Haresh Menghani at FXStreet, the US central bank seems disinclined to reduce interest rates soon, citing inflationary pressure from US President Donald Trump’s stringent tariff policies.
In another development, the US Census Bureau reported that Retail Sales increased by 1.4% in March, marking the highest growth in over two years, following a revised 0.2% increase previously, which surpassed market expectations of a 1.3% rise.
Simultaneously, the equity markets in the Asia-Pacific region saw an uptick on Thursday. Furthermore, traders still seem to be betting on a potential resumption of the US central bank’s rate-cutting cycle in June, preventing aggressive moves from US Dollar (USD) bulls while Bitcoin indicates signs of resilience.
Market participants are now anticipating key US economic indicators, including the traditional Weekly Initial Jobless Claims, the Philly Fed Manufacturing Index, housing market data, and further comments from the Fed, to identify short-term opportunities.
Decline in demand for US Bitcoin Spot ETFs follows a brief increase
Institutional inflows have continued to weaken this week. Based on data from SoSoValue, US spot Bitcoin ETFs reported a net outflow of $169.87 million on Wednesday, following a modest two-day inflow of $77.42 million earlier this week. If this trend of net outflows persists and escalates, Bitcoin’s price may face further downward corrections.
Total Bitcoin Spot ETFS netflow daily chart. Source: SoSoValue
Bitcoin Price Outlook: BTC momentum indicators signal uncertainty
Bitcoin has repeatedly faced resistance around its 200-day Exponential Moving Average (EMA) at $85,000 since Saturday. On Tuesday, BTC attempted to break through this barrier but faced rejection and saw a decline of 1.12%. However, it managed to stabilize around $84,000 the following day and continues to hover at this level as of Thursday.
If BTC closes above $85,000 on a daily basis, it could pave the way for a rally towards the crucial psychological mark of $90,000. A successful close beyond this threshold could further lead to testing its March 2 peak of $95,000.
The Relative Strength Index (RSI) on the daily chart remains flat at its neutral level of 50, indicating indecision among traders. For bullish momentum to gain traction, the RSI needs to break above its neutral level.
BTC/USDT daily chart
Conversely, should BTC continue its downward trajectory, the price may further decline to retest its subsequent daily support level at $78,258.
FAQs about Bitcoin, Altcoins, and Stablecoins
Bitcoin is the leading cryptocurrency by market capitalization and serves as a virtual currency for exchanges. It operates independently of any one person, group, or entity, eliminating the need for intermediaries in financial transactions.
Altcoins refer to any cryptocurrencies other than Bitcoin. Some consider Ethereum to be a non-altcoin due to its significant role in cryptocurrency forking. If this view holds, Litecoin is recognized as the first altcoin, derived from the Bitcoin protocol and often viewed as an “enhanced” version.
Stablecoins are cryptocurrencies designed to maintain a steady value, supported by a reserve of the asset they represent. Typically, the value of a stablecoin is pegged to a commodity or financial instrument like the US Dollar (USD), with its supply adjusted through algorithms or demand regulation. The primary purpose of stablecoins is to provide an accessible entry and exit point for investors in the cryptocurrency market while also offering a means to preserve value amidst general market volatility.
Bitcoin dominance is the ratio of Bitcoin’s market cap to the total market capitalization of all cryptocurrencies. This gauge reflects Bitcoin’s appeal among investors. Typically, a high BTC dominance occurs before and during bullish market phases, when investors prefer to invest in stable and well-capitalized cryptocurrencies like Bitcoin. Conversely, a downturn in BTC dominance often indicates investors reallocating funds to altcoins in pursuit of higher returns, leading to surges in altcoin markets.
