Bitcoin Tests $85K Resistance Amid Market Volatility
Bitcoin has once again surged past the $85,000 resistance level, a critical price zone that has held firm for the past ten days. The leading cryptocurrency saw a 5% rebound from recent lows, driven in part by speculation around the Federal Open Market Committee (FOMC) meeting and Federal Reserve policy decisions.
Despite Bitcoin’s impressive rally, it has struggled to maintain momentum above the $85,000-$86,000 range. Over the past week, BTC has repeatedly tested this barrier, only to retrace amid ongoing market uncertainty.
Federal Reserve Policy Adds to Market Uncertainty
Wednesday’s FOMC meeting played a crucial role in Bitcoin’s latest price action. As expected, the Fed left interest rates unchanged, keeping the upper bound at 4.50%. However, the key takeaway was the central bank’s forward guidance, particularly regarding balance sheet reductions and future rate cuts.
According to reports, the Fed plans to slow its quantitative tightening (QT) process, reducing its monthly Treasury redemption cap from $25 billion to $5 billion starting in April. Additionally, the Fed’s dot plot suggests an expected 50 basis point rate cut in 2025.
While the immediate rate decision was priced in, the Fed’s stance on future monetary policy remains a pivotal factor for risk assets like Bitcoin. Crypto analyst CRG noted that market reactions are less about the rate decision itself and more about the Fed’s tone, guidance, and economic outlook.
Bitcoin’s Key Price Levels to Watch
As Bitcoin trades within a volatile range, traders are closely monitoring key levels that could determine its next major move.
$85,000 Resistance – Make or Break Moment
Bitcoin briefly spiked to $85,880 following the Fed announcement, marking a 10-day high. However, sustaining momentum above this level remains a challenge. Analysts warn that BTC must break decisively above the $85,000-$86,000 range to confirm bullish continuation.
Crypto trader Daan Crypto Trades highlighted the importance of this level, pointing out that Bitcoin has struggled to reclaim its Daily 200MA/EMA cluster. A strong breakout could propel BTC toward the psychological $90,000 level, signaling renewed bullish momentum.
$80,000-$81,000 – Strong Support Zone
If Bitcoin fails to hold $85,000, traders are eyeing the $80,000-$81,000 range as a critical support zone. This area has served as a strong accumulation level in previous price action, and a retest could offer buying opportunities for long-term investors.
Potential Downside – Risk of Drop to $73,500
In the worst-case scenario, Bitcoin’s failure to hold key support levels could trigger a sharper correction. Analyst Rekt Capital noted that while seller volume has declined, buyers need to step up with stronger conviction to sustain the rally. If bulls lose momentum, BTC could revisit the $73,500 support level, a price point that previously acted as a strong base for upward moves.
FOMC Volatility Could Trigger Bitcoin’s Next Move
Market reactions to FOMC meetings are often unpredictable, with Bitcoin historically experiencing heightened volatility in the aftermath of Federal Reserve policy updates. Traders will be watching closely to see whether BTC can reclaim the $85,000 resistance or whether a rejection will lead to a deeper retracement.
With macroeconomic uncertainty and Bitcoin’s halving event on the horizon, the next few weeks could be crucial in shaping BTC’s long-term trajectory. For now, all eyes remain on the $85,000 mark as Bitcoin prepares for its next big move.
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