Bitcoin Price Prediction: Will Powell’s Congress Testimony Impact BTC’s 12% Bounce Back? (2024)

Bitcoin price prediction: BTC made a shocking move on Tuesday, first breaking out to a new all-time high of $69,170 and flash falling below $60,000 moments after to $59,323, according toCoinMarketCapdata.

The sudden plunge tipped off massive liquidations, exceeding $1 billion. AsCoinglassdata shows, liquidations in BTC accounted for approximately $800 million of the total. Moreover, the majority of the liquidations comprised longs, implying that leveraged bulls suffered immense losses.

What Triggered The Sell-Off?

According to some market watchers’ reports, profit-taking and miners offloading their wallets added significantly to the volatility, resulting in the flash drop. A glance at the Miner’s Outflow (Total) trends by CryptoQuant revealed a sudden spike in selling activities, especially from BTC miners.

The chart below shows the Miners’ Outflow exploding to 39,000 on March 1 and 36,000 BTC on March 5. During this period, miners transferred a colossal amount of BTC to exchanges, anticipating to sell at or near the previous all-time high.

Amid the intense volatility, Bitcoin swiftly rebounded on March 6 to trade at $66,188 during US business hours. Select altcoins have also made an impressive comeback, led byEthereum priceas it makes headway above $3,800.

Uniswap (UNI), Leo Token (LEO), and Aptos (APT) are some of the altcoins recovering in substantial single-digit and double-digit percentages.

Bitcoin Price Prediction: Where To Next As BTC Makes Major Comeback?

The drop to $59,323 spooked investors, leaving many dealing with unexpected losses. However, BTC’s immediate rebound above $66,000 confirmed that sentiment has not changed and that the rally will continue.

Based on the four-hour chart, a period of sideways price action could take preceded beforeBitcoinmakes another major move above its most recent record high.

The Moving Average Convergence Divergence (MACD) indicator backs the short-term bearish outlook after presenting a call to sell BTC. If the blue MACD line holds below the red signal line and the indicator drops further toward the neutral area (0.00), more traders would be compelled to sell to buy later at a lower price level.

Bitcoin’s immediate support lies with the 20-day Exponential Moving Average (the line in blue on the chart at $6,412). Several four-hour candle closes above this level will steady the uptrend, for another run toward $70,000.

If declines overshoot the 20-day EMA, confluence support created by the 50-day EMA (the line in red on the chart) and the ascending trendline (in black) will try to absorb the selling pressure.

Investors may take advantage of the discounted price to load up on BTC while betting on the continuation of the uptrend, with attributes to the well-performing Bitcoin ETFs.

BlackRock’sIBIT ETF stands out after maintaining the highest daily net inflows since the SEC gave the green light.SoSoValue, a platform tracking the performance of the products, highlighted a staggering $788 million in daily net inflow into IBIT, listed on Nasdaq.

Grayscale’s GBTC is on the other extreme, posting the biggest daily net outflow of $332 million on March 5. So far, the cumulative total net inflow reached $8.56 billion on Tuesday.

Jerome Powell Heads To Congress To Testify

Jerome Powell, the Federal Reserve’s chair is expected to appear at Capitol Hill for Congress hearing amid mixed signals from Bitcoin and gold in the traditional market.

The lawmakers are expected to dwell on the state of the economy with rate cuts likely to take centre stage in the testimony. At the end of the previous FOMC meeting, Powell remarked saying that members did not foresee the first interest rate cut in March, with inflation coming in hotter than expected in January.

Powell and other officials of the bank have over the recent weeks emphasized that they are in no hurry to begin rate cuts, underpinning a stronger US economy.

His comments later today will provide a sneak peek into the future of the economy. Lawmakers will want to know why the Fed is holding borrowing costs high despite making commendable leaps in inflation.

Participants in the crypto market would be on the lookout for comments likely to prop Bitcoin for a rally, or those that may dampen the recovery on March 6.

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