Bitcoin’s best day in a month and a half

24 August 2023 144
Bitcoin’s best day in a month and a half

On Wednesday, Bitcoin quotes showed the best dynamic for the last month and a half. The main cryptocurrency rose by 3%, reversing the current week’s decline. On a daily chart, a bullish engulfing pattern was formed, indicating a high possibility of further growth. The changing news background also speaks in favor of increasing demand for Bitcoin and other risky assets.


Yesterday, the statistics on business activity in the EU was published. The data were lower than expected, but the European economy has been balancing on the verge of recession for almost a year. That is why we can not call such figures absolutely unforeseen. In the evening, market participants were waiting for the similar statistics in the U.S. Investors did not get used to poor data, so their reaction was quite emotional.


S&P Global reported that business activity in the U.S. fell from 52 to 50.4 points. This was the worst value since February and the strongest monthly decline from last November. Taking into account very strong GDP and retail sales figures, such negative momentum in the PMI indices surprised traders. They reacted by actively selling dollars and buying riskier assets.


Hopes that the U.S. economy will be able to avoid a recession, may be too optimistic. Even if the moment of its beginning has been delayed, it should be followed by a reversal of the Fed's monetary policy in any case. Thinking about the start of the cycle of interest rate cuts, investors have already rushed to buy up assets that have suffered from a too high dollar rate in recent years. The cryptocurrency market has not been left behind either, and Bitcoin is well positioned to regain some of its lost popularity.


The RSI indicator is making a sharp upward reversal from the oversold zone. This increases Bitcoin's chances for further upward movement. The nearest growth target may be the level of 27,700. This scenario will remain relevant, as long as its quotes stay above the 25,500 mark.

 


We may offer you the following trading strategy:

 

Buy BTCUSD in the range of 26300-26600. Take profit – 27700. Stop loss – 25500.

 

Also, traders can use a Trailing Stop instead of a fixed Stop loss at their discretion. 

This content is for informational purposes only and is not intended to be investing advice.

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