Hawkish FED Minutes Sink Bitcoin (BTC) and the Broader Crypto Market

On Wednesday, Bitcoin (BTC) slid by 5.11%. Following a 2.38% loss from Tuesday, BTC ended the day at $43,178.

Bearish from the start of the day, Bitcoin slid from an early morning high of $45,518 to a final hour intraday low of $43,130.

The reversal saw Bitcoin fall through the day’s First Major Support Level at $44,861 and the Second Major Support Level at $44,219.

Following Tuesday’s pullback to 48/100, the Bitcoin Fear & Greed Index tumbled to 34/100 on Wednesday.

The slide saw the index fall into the ‘Fear Zone’, as the markets reacted to the overnight FOMC meeting minutes.

On Wednesday, the FOMC meeting minutes revealed the FED’s plans to reduce the balance sheet by $95bn per month. The markets responded negatively, with interest rates on the rise and an aggressive balance sheet reduction plan now in play.

Across the U.S equity markets, the NASDAQ 100 followed Tuesday’s 2.26% loss with a 2.22% decline.

For a Bitcoin move through to $50,000, the index would need to return to 54/100 and the ‘Greed’ zone.

At the time of writing, Bitcoin was up by 0.84% to $43,540. A mixed start to the day saw Bitcoin fall to an early morning low of $43,129 before striking a high of $43,561.

Bitcoin will need to move through the day’s $43,940 pivot to make a run on the First Major Resistance Level at $44,754. Bitcoin would need broader market support to return to $44,500 levels.

In the event of another extended rally, Bitcoin could test the Second Major Resistance Level at $46,333 and resistance at $46,500. The Third Major Resistance Level sits at $48,718.

Failure to move through the pivot would bring the First Major Support Level at $42,360 into play. Barring another extended sell-off, Bitcoin should avoid sub-$42,000. The Second Major Support Level sits at $41,558.

Looking at the EMAs and the 4-hourly candlestick chart (below), it is a bearish signal. Bitcoin sits below the 200-day EMA, currently at $43,592. This morning, the 50-day EMA narrowed to the 100-day EMA, testing support. The 100-day EMA narrowed to the 200-day EMA, which was BTC negative.

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