Under the hawkish tone of the Federal Reserve, why have the two giants of cryptocurrency, Bitcoin and Ethereum, surged? Unraveling the underlying logic of the cryptocurrency market's counter-trend rise and future layout!

CN
4 hours ago

Under the "hawkish" tone of the Federal Reserve maintaining interest rates, why is the crypto market "ignoring" hawkish warnings and rising strongly, with Bitcoin hitting the 100,000 mark and Ethereum testing the 2,000 level? Multiple intertwined factors are reshaping the market landscape. On the expectation front, the market has fully digested the "no rate cuts in the short term" narrative, with CME interest rate futures showing an 85% probability of a rate cut in July, and strong expectations for two rate cuts within the year. The "hawkish facade" is underpinned by easing expectations, supporting the continued rise of risk assets. Trump's lifting of AI technology restrictions has instantly ignited enthusiasm for tech stocks. Leading stocks like Nvidia are leading the charge, boosting valuations in the tech sector and attracting a large influx of capital. The hot tech stock market has revived market risk appetite, with Bitcoin, possessing both "digital gold" and "tech asset" attributes, standing out as a target for capital. The resumption of US-China trade negotiations is also a key variable. The market is focused on Trump's speeches, anticipating progress on trade issues. Historical experience shows that when the trade environment improves, the crypto market benefits from heightened liquidity expectations and emotional recovery, and this resumption of negotiations provides support for asset price increases.

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Bitcoin's sudden surge has seen it test the 99,850 level, and many friends casually ask if it will rise further and to what level. Based on Fibonacci extension lines and key resistance level analysis, there are two important upward target levels for Bitcoin's price in the short term. The first target is around 102,000 USD, a strong resistance level formed by a previous trading dense area. Once broken, it is expected to further test 104,500 USD. Observing the volume-price relationship, the current market is dominated by bullish forces, with both open interest and trading volume increasing, indicating strong upward momentum. In terms of risk control, the probability of a significant pullback resembling a "door painting" is low. Even if a correction occurs in the short term, it is likely to happen when the price approaches the key resistance level of 102,000 USD. Therefore, in the current market environment, a short-term bullish strategy is highly feasible. For entry point selection, based on the support of the Bollinger Bands' middle track and moving averages, conservative investors can accumulate positions near 98,400 USD, while aggressive investors can focus on the 98,800 USD support level. The 98,400 - 98,800 USD range has formed an effective support band, combined with the MACD indicator's upward movement above the zero axis, providing a safety margin for bullish entry. The market sentiment index (Greed and Fear Index) remains in the greed zone, with an overall healthy trend. Unless there is a systemic financial risk, significant negative regulatory policies (such as global tightening of digital currency regulations), or the price effectively breaks below the key support level of 97,000 USD (which would trigger a large number of stop-loss orders and disrupt the current upward trend), this round of upward momentum is still expected to continue.

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Ethereum's official announcement of the Pectra upgrade activation on the mainnet includes key content such as iterations of user experience features for smart account wallets, a 100% increase in storage block capacity in the L2 expansion plan, and optimizations for the validator operation interface and performance. From a price-driving perspective, the recent rise in Ethereum's price has limited correlation with the Pectra upgrade. This round of upward momentum is mainly driven by Bitcoin's strong performance and the linkage effect with the US tech sector, while the main capital in the market has reshaped the long-short game pattern through effective chip cleaning strategies. On a technical level, after experiencing a phase of bottom consolidation, Ethereum's price shows typical oversold rebound characteristics, like a compressed spring releasing potential energy, achieving synchronous resonance with Bitcoin through market sentiment transmission. Based on the technical analysis framework, Ethereum's price has a clear upward trend in the short term, with target prices pointing above 2,000 USD. There are currently two key resistance levels: the secondary resistance level is around 1,960 USD, where previous trapped positions and short-term profit-taking may trigger a technical pullback; the main resistance range is 1,990-2,020 USD, which includes important Fibonacci retracement levels and historical trading dense areas. The support system below shows a stepped distribution, with the primary support range at 1,900-1,910 USD, corresponding to the daily MA20 moving average and the middle track of the Bollinger Bands; the secondary support range is 1,860-1,870 USD, representing the recent bottom of the oscillation box and a key psychological price level, forming a strong price moat.

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If you are feeling lost—don’t understand the technology, don’t know how to read the charts, don’t know when to enter the market, don’t know how to set stop-losses, don’t understand take-profit strategies, randomly increase positions, get stuck while trying to catch the bottom, can’t hold onto profits, or miss out on market movements… these are common issues for retail investors. But don’t worry, I can help you establish the correct trading mindset. A single profitable trade is worth more than a thousand words, and finding the right direction is better than repeatedly facing defeats. Instead of frequent operations, it’s better to strike precisely, making each trade more valuable. If you need real-time guidance, you can scan the QR code at the bottom of the article to follow my public account. Market conditions change rapidly, and due to the timeliness of reviews, subsequent trends will be based on real-time layouts. I look forward to moving steadily forward in the market with you.

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