Ahead of today’s FOMC meeting, Bitcoin added a few hundred dollars, jumping to a new high of $28,775. Bets are piling up over how Bitcoin’s price will react to the Federal Reserve’s decision on interest rates, and the $30,000 mark is in sight. However, a drop to below $20,000 is not off the table. Additionally, several altcoins like XRP, ADA, ALGO, and XLM have posted significant gains, indicating the possible start of a bull market.
Bitcoin Nearing The $30,000 Mark
Last week saw the collapse of two of the most crypto-friendly banks, Silvergate and Signature. Furthermore, regulators also shuttered the Silicon Valley Bank (SVB), which held funds of about 50% of the tech startups. These events made investors question the integrity of traditional investment tools that are controlled by a central organization.
With some of the largest US banks collapsing, Bitcoin came on top as a non-correlated global hedging instrument similar to gold. This makes the upcoming Federal Open Market Committee (FOMC) meeting the most anticipated Fed meeting ever. On March 22, the FOMC will decide how to tweak the baseline interest rates amid the ongoing US banking crisis.
Meanwhile, some blame the US central bank for disrupting the national banking system due to its continuous rate hikes. As such, many people, including Elon Musk, have raised doubts that it will again raise the interest rates on March 22. The banking crisis and people’s expectations of the Fed have propelled risk assets such as Bitcoin to new local peaks. Bitcoin price recently soared from $20,000 to over $28,700 within days to reach its highest price in 9 months, pushing the Greed index north.
The past 24 hours have been relatively calm as BTC remained around $28,700. Yet we can safely assume there will be more volatility in its price later today, depending on whether the Fed will raise its interest rates. In a more conservative view, the current spot price trading range represents significant historical resistance. While the bullish market can take out short liquidations and raise the price to $30,000, the price can fall up to $20,000 to take out long bettings.
XRP Report Massive Gain
Leading crypto exchanges like Gate.io experienced increased altcoin trading volume, reporting a positive sentiment and outlook. While most altcoins like BNB, SOL, and TRX have had minor gains today, XRP stole the show by surging over 20%. The coin tapped a multi-month high of its own at $0.49.
Nearly two years ago, the SEC filed a lawsuit against Ripple for allegedly selling securities without registering itself with the SEC. The case boils down to whether or not XRP, Ripple’s digital token, should be classified as a security. The XRP rally started on March 21 as investors pinned their hopes on Ripple winning its ongoing legal battle.
If Ripple manages to win this high-profile lawsuit against the SEC, it would have a “ripple” effect on the entire crypto market. The legality of crypto is pretty ambiguous in the US, and the outcome of this case would help investors get clarity on the future of cryptocurrencies. The effect is already clear in the market as other altcoins and Bitcoin are gaining new local highs. The increase in trading volume and price of all these assets have helped the cumulative market cap of all crypto enter $1.2 trillion.
Ethereum Targets The $2,300 Mark
Earlier today, Ethereum crossed its $1,800 mark and holds that price point quite well. The price has been rallying quite well since the sharp rebound from its 200-day moving average of $1,400. Currently, Ethereum is testing the key $1,800 resistance level and the price can soon target the $2,000 mark. If the ongoing crypto hype continues, Ethereum can easily cross the $2,300 level in the coming weeks. On the other hand, in case of a fake breakout, Ethereum can plummet to the $1,400 support area.
Amid the ongoing US banking crisis, investors are worried about how it will affect the crypto market. The gap between trading prices on various exchanges points to higher buying pressure in the US, and if this behavior persists, the crypto market may enter a new bull run. However, if the gap closes, you should be careful as it might indicate the start of a bearish reversal.
Future outlook
Needless to say, but crypto markets did wonders during the banking collapse. Not only did the market decouple itself from standard stock markets, but we also began to see the rise of new positive market sentiment. Whether BTC will increase in value to $1,000,000 as some industry players proclaim, is questionable. But certainty now definitely lies in the fact that crypto is on the rise and bulls greatly prevail over bears in 2023.
