BTC/USD Forex Signal: Bitcoin Forms a Risky Pattern as Rally Stalls – 29 January 2025

Bearish view

-- Sell the BTC/USD pair and set a take-profit at 95,000.
-- Add a stop-loss at 106,000.
-- Timeline: 1-2 days.
Bullish view

-- Set a sell-stop at 100,000 and a take-profit at 95,000.
-- Add a stop-loss at 106,000.

Bitcoin price moved sideways overnight as market participants waited for the upcoming Federal Reserve decision. The BTC/USD pair remained slightly above the key support point at 100,000 following Monday’s plunge.

Bitcoin, like most other assets, crashed on Monday after DeepSeek, a Chinese startup, disrupted the artificial intelligence industry. The company launched an alternative to ChatGPT that cost way less to build, leading to worries about tech valuations in the United States.

Its launch and initial popularity led to a big drop in US tech stocks, with firms like NVIDIA and Broadcom shedding hundreds of billions of dollars. It also led to a big increase in liquidations in the crypto industry.

The focus among crypto investors is now on the upcoming Federal Reserve interest rates decision. Economists believe that the Fed will live to its guidance by maintaining interest rates unchanged. It has hinted that it will deliver just two rate cuts this year.

Bitcoin price will likely rise if Bitcoin delivers a dovish twist in this meeting, which is highly unlikely because of the recent inflation trends. Recent data showed that the headline Consumer Price Index (CPI) rose from 2.7% in November to 2.9% in December.

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BTC/USD technical analysis

The daily chart shows that the price of Bitcoin peaked at 109,200 earlier this month and then pulled back to a low of 97,713 on Monday. It has formed a double-top chart pattern, a popular bearish chart pattern made up of a twin-peak and a neckline at 88,913.

The BTC/USD pair has formed a bearish divergence chart pattern. The MACD indicator has continued falling, while the Relative Strength Index (RSI) has fallen from near 80 to about 50.

Therefore, there is a risk that the pair will likely have a bearish breakdown in the coming days. If this happens, the next level to watch will be at 88,900, its lowest point on January 13.

The bearish view will become invalid if the pair moves above the key resistance point at 108,180. Such a move would push it above the key psychological point at 110,000.

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Original Source DailyForex.com provides daily fundamental and technical analysis and signals for those looking to trade based on trends in the currency markets.