Bitcoin price has risen to the important resistance point of $30,000. It has jumped over 93% from the trough in 2022. Analysts note that crypto spring may be about to begin.
Bitcoin price is hovering around the $30,000 resistance level as investors assess the latest US inflation data as well as the positive FOMC minutes. BTC has soared more than 93% from its 2022 low, making it a better performer than gold, stocks, and other assets.
Fed Pivot Expectations
Bitcoin and other altcoins have done well on the hope that the Federal Reserve is nearing the peak of its bullish cycle, amid mounting recession risks. Data on Wednesday showed that headline inflation fell to 5.0% in March, the lowest point since 2021.
Other economic numbers have been relatively weak as of late. Last week, data from ISM and S&P Global showed that manufacturing and services PMIs fell in March. The manufacturing sector is faring even worse, as more companies move their production to the US.
Meanwhile, data released last Friday showed that wage growth continued to fall, despite the unemployment rate falling to 3.5%.
In view of the above, it is possible that the Fed is nearing the end of its hike cycle. In fact, the minutes published on Wednesday showed that some Fed officials supported pausing rate hikes, in order to observe the situation in the banking sector.
The members of the Federal Open Market Committee voted in favor of increasing the reference interest rate by a quarter of a percentage point. With this, the federal funds’ interest rate was between 4.75% and 5%, its highest level since the end of 2007.
“Several participants stressed the need to maintain flexibility and optionality in setting the right monetary policy stance given the highly uncertain economic outlook,” state the minutes.
Based on the abovementioned, with the Fed pricing in a recession and the yield curve inverted, there is a chance that a pivot is coming soon.
Spring Crypto Hopes
The Bitcoin price remained in a crypto winter during the Fed’s aggressive tightening phase. Now, there are hopes that a crypto spring will come as monetary conditions improve. In an interview on Tuesday, Mike Novogratz, CEO of Galaxy Investment Partners, a cryptocurrency investment firm, claimed that these actions by the Fed could push more people into cryptocurrencies. He expects the BTC price to retest its all-time high.
In a statement, Andrey Stoychev, Project Manager at Nexo, said that he thinks a crypto spring seems to be beginning. He cited the recent implosions of key banks like Credit Suisse and Silicon Valley Bank. Regarding the next prices to watch, he said the following:
“Now that we’re at the $30,000 price level, we’re close to the $32,000 threshold for the asset. Historically, we have seen resistance at $31,000 – $32,500. If BTC crosses $32.5K, we could potentially be on our way to $34-38K. While spring is an unpredictable season and it is still early to completely call off the ‘crypto winter’, these are favorable signs for the crypto space.”
By Audy Castaneda
