Bitcoin Dips Under $114.5K While Gold, Stocks Head Higher

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Key points:

  • Bitcoin diverges from stocks and gold to see daily losses of 2% to start the week.

  • Analysis hopes that the upcoming Federal Reserve interest-rate decision will provide a BTC price boost.

  • Hidden bullish divergences strengthen the case for BTC price gains.

Bitcoin (BTC) struggled at $115,000 into Mondayโ€™s Wall Street open as analysis saw more BTC price downside.

BTC/USD one-hour chart. Source: Cointelegraph/TradingView

BTC price sees โ€œclassicโ€ downside into FOMC

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD dropping up to 2% versus the dayโ€™s highs.

Bitcoin diverged from both gold and US stocks, with the S&P 500 and Nasdaq Composite Index both gaining at the open. Gold price passed $3,655, now under $20 from all-time highs.

XAU/USD one-day chart. Source: Cointelegraph/TradingView

Commenting, crypto trader, analyst and entrepreneur Michaรซl van de Poppe tied BTC price weakness to the weekโ€™s key macroeconomic event.

Bitcoin, he argued, traditionally trades down into US Federal Reserve interest-rate decisions.

โ€œVery classic price action prior to the FOMC meeting,โ€ he wrote in part of a post on X.ย 

โ€œVery likely we’ll continue to correct on $BTC & Altcoins until the FOMC meeting has passed.โ€

BTC/USD one-day chart with FOMC meeting dates marked. Source: Cointelegraph/TradingView

Van de Poppe referred to the Federal Open Market Committee, or FOMC, tipped by markets to deliver a 0.25% rate cut on Wednesday.ย 

While some crypto market participants expressed dismay at Bitcoinโ€™s inability to join risk assets in rallying at the start of the week, others eyed bullish chart cues.

Among these was a hidden bullish divergence for the relative strength index (RSI) on weekly timeframes.

โ€œBitcoin weekly hidden bullish divergence is now confirmed,โ€ popular trader BitBull reported.ย 

โ€œSince 2023, every bullish or hidden bullish divergence has played out for $BTC and resulted in big gains.โ€

BTC/USDT one-week chart with RSI data. Source: BitBull/X

Fellow trader Merlijn argued that the RSI divergence meant that the macro picture was โ€œscreaming continuationโ€ higher, calling BTC price upside โ€œinevitable.โ€

Bitcoin sentiment neutral as stocks climb โ€œwall of worryโ€

One similarity between Bitcoin and stocks came in the form of market sentiment as the week began.

Related: BTC โ€˜pricing inโ€™ whatโ€™s coming: 5 things to know in Bitcoin this week

Despite the S&P 500 reaching new highs and Bitcoin being not far below price discovery, sentiment was โ€œleaning bearish.โ€

โ€œIf anything, several measures of sentiment shows that fear is the prevailing emotion,โ€ trading firm Mosaic Asset Company wrote in the latest edition of its regular newsletter, โ€œThe Market Mosaic.โ€

Mosaic observed that large investors were net short across various stocks futures, โ€œwhere positioning in the group is seen as a contrarian signal.โ€ย 

โ€œVarious measures of sentiment are a tailwind for stock prices as the market climbs a wall of worry,โ€ it added.ย 

Investor stocks futures positioning (screenshot). Source: Mosaic Asset Company

The Crypto Fear & Greed Index remained in neutral territory at 53/100 on the day, far from overheated levels above 95 which traditionally accompany price action near all-time highs.

Crypto Fear & Greed Index (screenshot). Source: Alternative.me

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.