Crypto Green Days: Major cryptocurrencies are forming a topping pattern while FOMC interest rate hikes are just around the corner.
Overall crypto market cap and bitcoin are forming a potential topping pattern, while interest rates are expected to rise by 75 bps on Wednesday.
FOMC interest rate hike
The FOMC interest rate hike is scheduled for Wednesday, November 2 at 2:00 p.m. EST. FED President Jerome Powell will deliver a speech at 2:30 p.m. to conclude the session.
The FOMC will raise the interest rate for the sixth time in a row. The expected interest rate hike is 75 bps. Generally, when interest rates rise as expected, the market behaves neutral or positive. But if the increase is higher than expected, the bears take over the market.
Topping Pattern in Total Crypto Market Cap
The total crypto market cap is forming a potential head and shoulders pattern with a neckline near $929.40B. The chart shows that the left shoulder and head are already in.
The price, as of writing, is $967.12B. It can support the neckline and give a slight bounce to form the right shoulder. The crypto market is expected to bleed if it closes below the neckline after the formation of the right shoulder.
bitcoin double top
Bitcoin price failed to close above the 0.382 Fibonacci level at $20,850. A daily close above this was necessary for Bitcoin to sustain the current rally.
However, as of writing, the bitcoin chart is forming a potential double-top pattern with a neckline at the $20,000 level. The $20,000 level has proved to be a strong support, not to mention that it is also a psychological support.
Bitcoin could break the $20,000 support level if interest rates rise higher than expected. A breach of the support would result in bitcoin reaching the $19,000 level once again.
If the FOMC interest rate hike turns out as expected, there will be some bullish sentiment, or it will not affect the markets significantly. But, if the interest rate hike is 50 bps, there is a high chance that the bearish pattern may be invalidated, and the market will continue to trend upward.
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