BTCUSD has been selling off recently but it looks like bears are getting exhausted from the drop. Price has failed in its last two attempts to break below the $645 level, creating a double bottom pattern on its 1-hour chart.
This is a classic reversal signal, although price has yet to close past the neckline around $665 before confirming that an uptrend is in order. For now the 100 SMA is below the 200 SMA so the path of least resistance is to the downside. In addition, the 200 SMA appears to have held as a dynamic resistance area.
However, the gap between the moving averages is narrowing so a crossover could be possible. In that case, more bulls could increase the upside pressure and likely take BTCUSD up to the highs around $680 or higher.
Meanwhile, RSI is on middle ground, barely providing any strong clues on direction. Stochastic is heading lower so BTCUSD could follow suit and make another test of the lows at $645 or even go for a break lower.
The FOMC decided to keep monetary policy unchanged as expected while issuing a slightly upgraded assessment of the US economy, particularly when it comes to employment and household spending. Market watchers continue to expect a rate hike probably in September, which suggests that the dollar could stay supported against its rivals until then.
The US is still set to print its Q2 GDP reading before the end of the trading week and a 2.6% expansion is expected. This is a much faster pace than the first quarter’s 1.1% growth figure, confirming that the US economy is on much better footing. Still, if the report is enough to spur risk-taking, further gains in bitcoin could be possible as it was seen after the FOMC decision.