Is the Bitcoin plunge over? Nothing indicates it despite a rebound of 10%

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BTCUSD daily chart

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Investing.com – After deepening its dip to a low of $33,300 yesterday, Bitcoin has rallied, as high as $36,700 so far, a gain of 10%.

Bitcoin indeed reacted positively to a bullish reversal in US stock markets after a strongly bearish start to the session.

BTC rebounds, but not enough to turn the tide

However, although on paper a rebound of 10% is encouraging, this rise should be put into perspective with the drop of recent days. Thus, a quick glance at the daily chart shows that Bitcoin’s rebound since yesterday does not change the underlying trend, which remains negative.

Indeed, the study of the graphs suggests that only a return above the major psychological threshold of $40,000 would improve the profile of the daily data. But for now, a further decline towards the next key $30,000 support is just as likely as a return above $40,000.

Stock market trends and Fed meeting will determine the fate of Bitcoin

As for today, expect a rally in European equities this morning. Indeed, stocks in Europe plunged sharply, with one down 3.97% and one down 3.8%, but US stock markets pared their losses after the close in Europe, which argues for a positive open on the Old Continent. With bitcoin tending to show some correlation with stocks lately, we can expect a positive open in Europe to support the cryptocurrency.

But the most defining event for Bitcoin’s next moves will be tomorrow night’s Fed meeting, with the rate announcement at 8 p.m. and Jerome Powell’s press conference starting at 8:30 p.m.

A more hawkish-than-expected outcome would hurt Bitcoin, while a Fed that waters down its recent statements of monetary tightening intent would support BTC.

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