A widely followed crypto strategist is predicting how Bitcoin (BTC) will behave in response to the Federal Reserve announcing a fresh round of rate hikes.
Pseudonymous analyst Pentoshi tells his 540,600 Twitter followers that he sees Bitcoin rallying with tech stocks once the markets digest the news coming from the Federal Open Market Committee (FOMC) meeting.
“So many stocks at or around their March 2020 lows AFTER the Covid crash. Spotify, Netflix, Zoom, Paypal, and many more. Post FOMC rally for equities and BTC short term as many are at key pivot points looking to be setting up in my opinion.”
The Federal Reserve is expected to raise interest rates by 50 basis points after the May 4th meeting in an effort to curb inflation, according to CNBC.
Popular crypto trader Light agrees with Pentoshi’s prediction that BTC will likely surge after the FOMC meeting as he says the announcement will be a buy-the-news event.
“Candlestick watchers, line drawers, and other similar cave dwellers will once again be baffled after thinking they are trading BTCUSD and finding out the truth. Think VIX comes off post-FOMC. Thin liquidity and options will do the rest. Sell the rumor buy the news, again…
This is setting up again to be a buy the news event in almost any Fed outcome.”
Looking at the key levels to watch for Bitcoin in the coming days, Pentoshi says that a move above its immediate resistance at $39,700 will trigger a rally to $42,000.
“BTC will be monitoring $39,700 for the bias point. Above that = squeeze to $42,000. Staying agile, less sidelines from my end.”
At time of writing, Bitcoin is changing hands for $37,958.Don't Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox
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