Crypto Market Update: Fed Meeting Impact and Asset Price Analysis

Bitcoin is currently retesting a crucial resistance area while a bullish divergence continues to play out, as the market anticipates the upcoming FOMC meeting that could significantly influence short-term volatility. This analysis also covers key price movements and trading strategies for Ethereum, XRP, Solana, and Chainlink amidst ongoing market developments.

Key Points Summary

• FOMC Meeting and Interest Rate Decision

  The Federal Reserve's FOMC meeting is scheduled for October 29th, with its interest rate decision to be released at 6:00 p.m. GMT. The market largely anticipates a 0.25% interest rate cut, or 25 basis points, with a 98% probability currently priced in, reducing the high-end Fed funds rate from 4.25% to 4%.

• Market Volatility and Outcomes

  A 25 basis point rate cut is considered a neutral outcome, as it is already priced into the market, and would likely not trigger major volatility. Significant market volatility is anticipated if the outcome differs from the expected 25 basis point cut, with a 50 basis point cut being extremely bullish and no change leading to a short-term market dump. The Fed Chair's press conference, held about half an hour after the rate decision, can also introduce additional market volatility.

• Bitcoin Weekly Price Outlook

  On the weekly time frame, the Super Trend indicator remains green, suggesting a larger bull market, although a massive bearish divergence is actively playing out, indicating a lack of bullish momentum on larger time frames. Bitcoin has primarily been consolidating sideways since July-August, a trend expected to continue over the next few weeks.

• Bitcoin Daily and Short-Term Price Action

  Bitcoin's price continues its breakout above the 110.5K line, which now serves as new support, effectively mitigating the risk of a larger drawdown. A shorter-term bullish divergence is active on smaller time frames, like the 6-hour chart, with the price forming higher lows and higher highs, indicating a bullish relief trend that has not yet invalidated.

• Bitcoin Resistance and Support Levels

  Bitcoin is currently retesting strong resistance between 115,000 and 116,000, having previously been rejected from this area. Key support levels are identified at 111.7K to 112K (previous resistance turned support) and approximately 113.5K, from which the price recently bounced.

• Bitcoin Price Targets

  A confirmed breakout and sustained hold above 116,000 would likely lead to a bullish move towards 120.5K to 121K, which represents the next major price target and potential resistance. Liquidity is also building above 116.4K to 117K, reinforcing these potential upside targets.

• Automated Trading Strategy

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• Bitcoin Dominance Chart

  The Bitcoin dominance chart continues to play out a bullish divergence, suggesting an expected slight bullish relief in the short to medium term.

• Ethereum Price Outlook and Targets

  Ethereum holds strong support between 3.9K and 4.1K on the 3-day chart, and a bullish divergence on the daily chart implies either choppy sideways action or a bullish relief. On the 8-hour chart, ETH rejected from 4250-4280 resistance and found support at 4060-4.1K. A confirmed hold above this support could lead to a retest of 4250-4280, with a breakout above it targeting 4450-4.5K. A bullish breakout from a symmetrical triangle on the 4-hour chart has a price target of approximately $4570.

• Solana Price Action and Targets

  Solana is attempting a breakout above the 190-200 range, which, if confirmed with a candle close and sustained hold, would likely lead to a move towards $29 as short-term resistance, and potentially $230. This range would then flip to new support. A bullish divergence is active on shorter time frames, suggesting either bullish relief or choppy sideways price action in the coming days or weeks.

• XRP Price Movement and Targets

  XRP is currently testing resistance between $2.60 and $2.70, experiencing struggle. A confirmed bullish divergence on the daily chart suggests continued attempts at a bullish relief. An inverse head and shoulders pattern on the 8-hour chart has a bullish price target of approximately $2.88, which would be reached upon a confirmed breakout above $2.70. Above $2.88, $3.10 is the next significant resistance.

• Chainlink Price Structure and Targets

  Chainlink exhibits a bearish price structure in the larger trend but is playing out a short-term bullish divergence, indicating expected bullish relief or choppy sideways action. Strong resistance for Chainlink is identified between $19 and $20, specifically $19.50-$20. A confirmed breakout and sustained hold above $20 would be highly bullish, signaling the first sign of a trend reversal, with a subsequent move towards $22 as the next major target.

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