Bitcoin prices have lost momentum again as recovery efforts stalled shortly after the Federal Reserve (Fed) kept interest rates on hold.
At the time of writing, Bitcoin is trading at $76,172, up 0.04% since it opened early Thursday in Asian trading.
While the decision was widely expected, the cautious statement from the US central bank was enough to shake investor sentiment and put pressure on the crypto market again.
In its latest meeting, the Federal Open Market Committee decided to keep interest rates at their current range while stressing that geopolitical uncertainty in the Middle East remains a major risk factor.
Following the announcement, Bitcoin fell to around $74,900 before attempting to recover.
However, the bullish attempt remained weak as the price failed to break through a key resistance zone near the 20-day moving average.
Analysts see this reaction as a typical ‘sell the news’ situation, when traders take profits after a major market event.
However, the fact that Bitcoin was able to recover so quickly after the initial drop shows that buying interest still exists at low prices.
At the same time, market data shows that bearish leverage activity is starting to increase.
This indicates that many traders are starting to bet that the price will fall if Bitcoin continues to fail to break the current resistance.
If the selling pressure continues, the price has the potential to retest the strong support zone between $65,000 and $70,000.
However, it is not all negative as the influx of institutional funds via Bitcoin spot ETFs and continued interest in the derivatives market give the impression that big players still see the long-term potential of this digital asset.
This support could serve as a major bulwark if the market experiences a deeper correction.
Currently, Bitcoin is in a critical phase.
If it manages to re-break the $76,000 to $79,000 level, bullish momentum could be re-ignited.
But if it fails, the market may continue to move slowly with the risk of a short-term downside still open.
