Bitcoin price rose above $25,000 again today, continuing to try to reclaim the psychological level of $25K multiple times in the last few days. BTC price hit a high of $25,126, before starting a move lower.
Traders are closely monitoring whether the price of Bitcoin can hold above a key level to confirm further upside. Some believe the recent rally is a 'bull trap'.
Bitcoin's upward momentum will depend on two main factors. First, whether it can hold above $25,100 — the 200 Weekly Moving Average (WMA). The 200-WMA is one of the most effective indicators used by crypto traders to help identify long-term changes in the direction of Bitcoin.
In the last week, Bitcoin price saw an exact reversal from the 200-WMA, a strong resistance. If BTC price closes this week above the 200WMA, a massive rally could begin. Interestingly, the same level will completely eliminate the decline and the bullish momentum will take over the trend.
Another factor to consider is the minutes of the U.S. Federal Reserve's FOMC meeting. on February 22. The price of Bitcoin will remain volatile ahead of this milestone. Fed Chairman Jerome Powell previously reiterated that the deflationary process has begun, hinting at disinflation to put rate hikes higher than on schedule.
However, hawkish rhetoric by some Fed officials for a possible 50 bps rate hike at the FOMC meeting in March continues to put pressure on Bitcoin prices. Therefore, the FOMC Minutes become an important event that will determine the movement of the market.
On the other hand, several on-chain metrics confirm that the price of Bitcoin is in an early bullish market cycle.
With good market sentiment and China reportedly supporting Hong Kong to become a crypto hub and several crypto exchanges planning to expand to Hong Kong, the price of BTC could possibly go higher. BTC price is currently trading in the $24.7K-$25K range.
