Decisive Week: $8.3 Billion to Save the Crypto Market?
The atmosphere is electric. As the crypto market barely emerges from a critical oversold zone, all eyes are on the US economic calendar. The week’s major event is undoubtedly the $8.3 billion liquidity injection scheduled by the Federal Reserve this Tuesday. Historically, these Fed maneuvers act as fuel for risk assets, but the current fragility of order books calls for caution.
Meanwhile, the political sphere could add its dose of volatility. The expected nomination of Kevin Warsh to succeed Jerome Powell as Fed Chair (Monday) and the release of the federal budget balance (Wednesday) are potential catalysts. If the market interprets these signals as monetary easing, the current rebound could transform into a genuine rally. Conversely, any disappointment regarding inflation or budget figures could send investors heading for the exits.
Bitcoin and Ethereum: The Danger Zone Isn’t Far Away
From a technical perspective, the situation remains precarious despite the green displayed across markets. Bitcoin (BTC) is currently trading around the $70,000 – $70,900 zone, attempting to transform its former resistance levels into support. However, the market structure remains fragile as long as BTC doesn’t firmly reclaim $72,000 with volume. A break below $70,000 would invalidate the recovery scenario and expose the asset to another severe correction.
For Ethereum (ETH), the situation is even more delicate. Struggling around $2,100, the market’s second-largest cryptocurrency is having difficulty attracting buyers. Analysts are closely monitoring the psychological support at $2,000. If this level gives way under selling pressure, the door would open toward much lower targets, potentially toward $1,880, erasing all recent gains. The market is clearly awaiting a strong directional signal.
Should You Position Now or Wait for Capitulation?
While the Fed’s liquidity injection offers a short-term bullish argument, the structural weakness of the rebound calls for patience. Buy volumes aren’t yet convincing enough to confirm a sustainable trend reversal. The wisest strategy for this week might be to wait for daily candle closes post-Fed announcements before entering the market heavily.
Moreover, as trader Killa reminds us, Bitcoin has dropped an average of 8% after the 14th of the month over the last 7 months. Bitcoin will therefore remain volatile in the coming days. For now, BTC’s rise remains a correction within a clearly bearish momentum.
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