Bitcoin (BTC) has been struggling to maintain its momentum, trading around $65,100 and hitting an intraday low of $64,700. The cryptocurrency's price is under pressure due to a combination of factors, including hedge funds reducing their Bitcoin holdings to the lowest level since October 2020 and uncertainty surrounding Federal Reserve interest rate decisions.

Uncertainty Over Federal Reserve Rate Cuts Intensifies Selling Pressure

The Federal Reserve initially projected three rate cuts for this year but now expects only one, which has boosted US Treasury bond yields and the dollar. This shift in expectations has led to a mixed outlook for Bitcoin, as the reduced likelihood of aggressive rate cuts limits its potential gains, while the possibility of cuts later in the year supports sentiment.

Hedge Funds Reduce Exposure to Bitcoin

Cryptocurrency hedge funds have significantly reduced their exposure to Bitcoin, with their holdings now at the lowest level since October 2020. This reduced exposure indicates a cautious approach by hedge funds, which may be anticipating further drops or volatility. The last time hedge fund exposure was this low was in October 2020, just before a significant Bitcoin bull run.

Key Points

- Hedge funds reduced Bitcoin exposure to 0.37, the lowest since October 2020.

- Reduced exposure indicates hedge funds' cautious approach due to expected volatility.

- Increased selling pressure from hedge fund withdrawal pushed Bitcoin below $65,000.

- This reduced exposure has likely increased selling pressure, contributing to Bitcoin's fall below the crucial $65,000 mark.

Bitcoin Price Prediction

Bitcoin is currently trading at $65,100, up 0.64%. On the 4-hour chart, the pivot point is $65,700, a critical level for determining the next price movement. Closing of candles under the pivot point level of $65,500 suggests a bearish Bitcoin price prediction.

Immediate resistance is noted at $66,800, followed by $67,800 and $68,500. On the downside, immediate support is at $64,150, with further support at $63,200 and $62,300. The Relative Strength Index (RSI) is at 47, indicating neutral momentum. The 50-day Exponential Moving Average (EMA) stands at $65,600, aligning with the downward channel extending resistance near the $65,500 level, limiting Bitcoin's upside movement.

Conclusion

The outlook remains bearish below $65,500, but a break above this level could boost bullish momentum. Conversely, staying below $65,500 could drive a continued downtrend.