Recommendations for Trading in the Cryptocurrency Market on January 29

[Ben Graham]

Bitcoin was unable to hold above $90,000 for long and has already retraced to around $88,000 today. Ethereum has also fallen below the $3,000 mark, which is quite negative for its future upward prospects.

Yesterday's US Federal Reserve meeting put pressure on risk assets, which also affected the cryptocurrency market. Although few expected the central bank to be lenient in its statements, there were hopes for that.

The only positive note is that the Fed will continue open market operations to maintain the rate within the established range by buying government bonds, thereby increasing its balance sheet. This represents a softer approach to sustaining economic activity and the labor market. However, the committee also noted that inflation remains somewhat elevated and that uncertainty regarding economic prospects remains high. All of this indicates that the US central bank does not plan to reduce interest rates in the near future. And as we know, the more restrictive the Fed's policy, the fewer willing buyers of risk assets, including in the cryptocurrency market.

Regarding the intraday strategy in the cryptocurrency market, I will continue to act based on any significant pullbacks in Bitcoin and Ethereum, anticipating the continuation of the long-term bullish market, which has not gone away.

For short-term trading, strategies and conditions are described below.

Bitcoin

Buying Scenario

Scenario #1: I will buy Bitcoin today upon reaching an entry point around $88,500, with a target of $89,100 for growth. Around $89,100, I will exit my long positions and sell immediately on the retracement. Before buying on a breakout, ensure that the 50-day moving average is below the current price, and the Awesome indicator is above zero.

Scenario #2: I can buy Bitcoin from the lower boundary of $88,000 if there is no market reaction to its breakout in the opposite direction towards the levels of $88,500 and $89,100.

Selling Scenario

Scenario #1: I plan to sell Bitcoin today upon reaching an entry point around $88,000, with a target to decline to $87,300. Around $87,300, I will exit my short positions and buy immediately on the retracement. Before selling on a breakout, ensure that the 50-day moving average is above the current price, and the Awesome indicator is below zero.

Scenario #2: I can sell Bitcoin from the upper boundary of $88,500 if there is no market reaction to its breakout in the opposite direction towards the levels of $88,000 and $87,300.

Ethereum

Buying Scenario

Scenario #1: I will buy Ethereum today upon reaching an entry point around $2,961, with a target of $2,990. Around $2,990, I will exit my long positions and sell immediately on the retracement. Before buying on a breakout, ensure that the 50-day moving average is below the current price, and the Awesome indicator is above zero.

Scenario #2: I can buy Ethereum from the lower boundary of $2,938 if there is no market reaction to its breakout in the opposite direction towards the levels of $2,961 and $2,990.

Selling Scenario

Scenario #1: I plan to sell Ethereum today upon reaching an entry point around $2,938, with a target for a decline to $2,910. Around $2,910, I will exit my short positions and buy immediately on the retracement. Before selling on a breakout, ensure that the 50-day moving average is above the current price, and the Awesome indicator is below zero.

Scenario #2: I can sell Ethereum from the upper boundary of $2,961 if there is no market reaction to its breakout in the opposite direction towards the levels of $2,938 and $2,910.

The material has been provided by InstaForex Company - www.instaforex.com