The more dovish
than expected FOMC decision eventually marked the bottom in many risk assets
including Bitcoin. In addition, the benign US CPI figures on Wednesday were the
trigger for the risk-on sentiment that took US stocks to new all-time highs and
boosted the cryptocurrency. As long as the positive sentiment holds, we should
see new highs for Bitcoin in the next few weeks with a break above the 67275
level probably confirming the bullish case.

Bitcoin Technical
Analysis – Daily Timeframe

On the daily
chart, we can see that the break below the key support
zone around the 60K level eventually turned out to be a fakeout. The
cryptocurrency is now near a key swing point around the 67275 level. A break
above that level should open the door for a rally into the cycle highs if not
even higher.

Bitcoin
Technical Analysis – 4 hour Timeframe

On the 4 hour
chart, we can see that the more dovish than expected FOMC decision marked the
bottom for the correction and the benign US CPI figures were the green light
for a rally in risk assets. The price action around the 60K support might have
also formed an inverted
head and shoulders pattern with the 67275 level as the neckline.

We can expect the
sellers to lean on the neckline with a defined risk above it and target a drop back
into the 60K support. The buyers, on the other hand, will want to see a
breakout to the upside to increase the bullish bets into the cycle highs.

Bitcoin
Technical Analysis – 1 hour Timeframe

On the 1 hour
chart, we can see that the bullish momentum is waning ahead of the key resistance
as depicted by the divergence
with the RSI.
Moreover, the average
daily range marked by the red lines shows that Bitcoin is unlikely to extend
to new highs today and if it the price rallies into the resistance it’s more
likely that we will see a rejection.

A good level where
to lean on for the buyers would be the swing low at 64568 as a break below that
level might invalidate the bullish case and see the cryptocurrency falling back
to the 60K support.

Upcoming
Catalysts

We don’t have any
noteworthy catalysts for today, so the markets will likely follow the path of
least resistance set by the US CPI report or just consolidate into the weekend.

This article was written by Giuseppe Dellamotta at www.forexlive.com.