Bitcoin breaks $80,000 as Fed rate hike fears subside, how far will it go?

▲ USD, Bitcoin (BTC) ©

As expectations for a halt in the U.S. Federal Reserve's (Fed) benchmark interest rate hikes spread across the market, Bitcoin (BTC) broke through the $80,000 mark, and Zcash (ZEC) and Ethena (ENA) showed explosive growth.

According to investment media FXStreet on September 4 (local time), Bitcoin surged 5% the previous day, recording its highest daily closing price since May 11, and continues to show strength above the $80,000 level. According to the Chicago Mercantile Exchange (CME) FedWatch Tool, the probability of a September rate hike, which was close to 70% earlier this week, plummeted to 50% after Fed Governor Christopher Waller stated he could support a rate freeze in September if August inflation eased.

Technical indicators also support Bitcoin's potential for further upside. Bitcoin is comfortably trading above its 50-day, 100-day, and 200-day Exponential Moving Averages (EMAs), which are formed between $69,700 and $72,500. It is currently advancing towards the 78.6% Fibonacci retracement level of $87,476 from the recent decline from $97,924 to $57,800. If this level is breached, it could aim to reclaim its previous high of $97,924. However, signs of short-term overheating are also detected, with the Relative Strength Index (RSI) entering the overbought zone at 71 and the Moving Average Convergence Divergence (MACD) histogram slightly expanding. Downside support levels are the 50% retracement level at $75,233 and the 200-day EMA at $72,493.

Amidst Bitcoin's positive momentum, privacy coin Zcash is also on a fierce run. Zcash surged 16% the previous day, hitting an all-time high of $979, and is on the verge of breaking $1,000. Trading well above its 50-day, 100-day, and 200-day EMAs, Zcash has broken above its previous swing high of $888 and is targeting the 127.2% Fibonacci extension level of $1,058. If it settles there, the upside opens up to the 161.8% extension line at $1,322. With the RSI in the overheated zone at 74 and MACD bouncing above the signal line, $888 and the 78.6% retracement level of $773 are expected to act as key support levels during a short-term correction.

Synthetic dollar protocol Ethena also showed strong upward momentum. Ethena surged 12% the previous day, firmly settling above $0.1600. It is trading above all its 50-day, 100-day, and 200-day EMAs, located at $0.1185, $0.1090, and $0.1279 respectively, and has established the recently reclaimed 50% retracement zone of $0.1356 as floor support.

Ethena's key upward resistance level is the 78.6% Fibonacci retracement line at $0.1982. The media predicts that if $0.1982 is definitively broken, the rally could continue to near the previous high of $0.2633. Currently, Ethena's RSI is at 66, and the MACD line is slightly above the signal line, indicating that strong buying momentum is maintained even amidst a slowdown after the surge.

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