By Chris Hollingworth 
Bitcoin (BTC) experienced a notable surge to two-week highs on March 20, driven by speculation surrounding a potential upcoming announcement from the US government regarding its cryptocurrency policy. The BTC/USD 4-hour chart displayed a sharp increase in price, with Bitcoin reaching nearly $87,500 on Bitstamp before consolidating around $86,000.
The surge in Bitcoin’s price was supported by a relatively uneventful Federal Reserve meeting the day before, during which officials decided to maintain interest rates at their current levels. Federal Reserve Chair Jerome Powell indicated that inflation had significantly eased, stating, “We do not need to be in a hurry to adjust our policy stance, and we are well positioned to wait for greater clarity.” This cautious approach by the Fed provided relief to risk assets, leading both Bitcoin and US stocks to rally, with the S&P 500 ending the day up by approximately 1%, adding $500 billion in market capitalization.
Arthur Hayes, former CEO of BitMEX, interpreted the Fed’s stance as a signal for traders to take on more risk, suggesting that the next bullish catalyst could involve exemptions from the Supplementary Leverage Ratio (SLR) or a return to quantitative easing.
Meanwhile, Bitcoin traders were closely monitoring rumors of a forthcoming announcement from the US government regarding its crypto policy, potentially set for March 21. Speculation indicated that President Trump might be planning a significant change in strategy, following the establishment of a national crypto reserve earlier in the month through an executive order. Despite initial market calmness over the reserve creation, a recent close above key resistance trend lines signaled renewed optimism among traders.
In the midst of these developments, popular trader and analyst Rekt Capital highlighted that Bitcoin only needed to rally around 8% more to position itself for a reclaim of the upper range and potentially end its recent downside deviation. Overall, the cryptocurrency market remained dynamic and responsive to external factors, with traders staying vigilant for potential market-moving announcements.
This article is intended for informational purposes only and does not offer investment advice or recommendations. Readers are encouraged to conduct their own research and analysis before making any financial decisions.
