Bitcoin (BTC) saw classic “choppy” price action on May 4 with hours to go before fresh Federal Reserve cues.
Data from Cointelegraph Markets Pro and TradingView followed BTC/USD as it bounced between support and resistance after hitting $37,600 on the evening of May 3.
A subsequent bounceback saw the pair clip $39,000 at the time of writing, providing relief to low-timeframe traders at 4.1% off the lows.
More broadly, however, Bitcoin stayed rangebound and beholden to macro triggers as markets braced for Fbrace for Fed-induced volatility.
The two-day meeting of the Federal Open Markets Committee (FOMC) and press conference was due to begin at 2:00 pm EST on May 4.
With little to comfort bulls, some turned to historical comparisons. The start of the Feds previous cycle of key interest-rate hikes in 2015 proved a turning point for BTC price strength, thus culminating in the December 2017 blow-off top.
“BTC is now testing a multi-week resistance,” popular trader and analyst Rekt Capital, meanwhile, concluded about the daily chart following the uptick above $39,000:
“Break this and the multi-week downtrend is over and $BTC will enjoy upside.”Elsewhere, amid growing calls for a “capitulation” style event to put in a fresh macro bottom on BTC/USD, contingency plans were also becoming conspicuously more vocal.
Related: ‘More likely’ BTC price will hit $100K before Bitcoin sweeps $30K lows, forecast says
MicroStrategy, the company with the worlds largest Bitcoin corporate treasury, went as far as to say that it would up its Bitcoin buys in such a scenario.
Speaking on its Q1 earnings call, Phong Le, the firms president and chief financial officer, also revealed the conditions under which it would receive a margin call on its Bitcoin-collateralized loan.
“As far as where Bitcoin needs to fall, we took out the loan at a 25% LTV, the margin call occurs 50% LTV. So essentially, Bitcoin needs to cut in half or around $21,000 before we'd have a margin call,” he said:
“That said, before it gets to 50%, we could contribute more Bitcoin to the collateral package, so it never gets there, so we dont ever get into a situation of March call also.”MicroStrategy thus appeared to state that it would actively support Bitcoin markets during a major capitulation. As Cointelegraph recently reported, BTC price forecasts currently call for between $25,000 and $30,000 as a worst-case scenario.