Crypto markets have shown a different reaction to macroeconomic events compared to the past. For example, recent interest rate hikes by the U.S. central bank in May and March only led to mild price movements of 1.13% and -2.87% respectively. Similarly, the impact of recent inflation and GDP data was relatively tame, with BTC experiencing price changes of just -0.74% and 1.16% respectively. It appears that crypto markets have already factored in the expected move on Wednesday.
However, what is more intriguing for traders is the current decline in BTC’s price, which has dropped below the lower range of its Bollinger Bands. This indicates a possibility of a slight upward movement in the price. Bollinger Bands are a technical indicator that tracks an asset’s 20-day moving average and plots price levels two standard deviations above and below the average. Typically, an asset’s price is expected to stay within the two standard deviations of its average around 95% of the time. Therefore, a breach of the external bands holds statistical significance.
Traders are now setting their sights on an upside target of the $30,000 level, which is above the current support at $29,000. This suggests that there is potential for a modest price increase in BTC.
In recent times, it seems that crypto markets have become less sensitive to macroeconomic events. In the past, news about interest rate hikes or economic data releases would have a more significant impact on cryptocurrency prices. However, the relatively mild reactions seen in the face of two recent interest rate hikes and economic data releases indicate a change in market dynamics.
This could be attributed to various factors, including increased market maturity and a growing acceptance of cryptocurrencies as an asset class. As the crypto market evolves, traders may start to focus more on technical indicators and market trends rather than solely relying on macroeconomic events to predict price movements.
The current decline in BTC’s price below the lower range of its Bollinger Bands suggests a potential buying opportunity for traders. The statistical significance of a breach in the external bands indicates a higher probability of an upward price movement. Traders are closely watching the $30,000 level as an upside target, which would require overcoming the current support at $29,000.
Overall, while crypto markets may not be as reactive to macroeconomic events as they once were, traders are still finding valuable insights from technical indicators like Bollinger Bands. The current price movement in BTC indicates a potential for a modest price increase, and traders are cautiously eyeing the $30,000 level as a key target.