Major cryptocurrencies traded in the green on Tuesday evening as the Federal Reserve began its two-day Federal Open Market Committee monetary policy meeting to decide whether to raise interest rates.

What Happened: Apex cryptocurrency Bitcoin (CRYPTO: BTC) is currently trading at around $28,096, with a brief midday spike taking BTC to as high as $28,605. 

Ethereum (CRYPTO: ETH) was up 2.10% to change hands below $1,800. Dogecoin (CRYPTO: DOGE) was trading at $0.075,  up 4.85% in the last 24 hours.

At the time of writing, the global crypto market capitalization stood at $1.18 trillion, an increase of 1.90% over the last day.  

U.S. stocks traded higher today amid a banking rally and improved investor optimism. The S&P 500 ended the day up 1.3%, while the tech-heavy Nasdaq Composite rose 1.5%. The coming Federal Reserve FOMC announcement on Wednesday is highly anticipated as markets have priced in a 25 basis point rate hike.

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News Highlights: A new report released by the White House is pushing an alarming narrative on digital assets, claiming they are falling short of their promise and risk compromising the stability of the U.S. financial system. President Joe Biden has ordered a series of studies to further assess the implications of digital assets, yet his annual economic report to Congress suggests the cautions and warnings have gone unheeded. 

According to the Crypto Fear & Greed index, crypto investors are currently feeling a strong sense of "greed," with a score of 68. Last year, the index hit a shocking low of 6 after the collapse of FTX, causing the price of the cryptocurrency to sink below $18,000. 

Analyst Notes: “Crypto traders might not see a major move until we see what happens with the Fed’s decision on rates and their forecasts. Risk appetite is rallying on optimism the Fed is almost done with tightening and that they will help prevent financial stability concerns from getting out of hand. A lot needs to go right for this risk-on rally to continue and that might be why Bitcoin is struggling to break away from the $28,000 level. A lot of traders are eyeing the $30,000 level for Bitcoin and depending on how [the] price reacts there, momentum flows could support a 5% move in either direction. If the Fed doesn’t spark a rally, Bitcoin could settle closer to the $25,000 region,” said Edward Moya, senior market analyst at OANDA.

Crypto analyst Michaël van de Poppe said that tomorrow's outcome will be heavily anticipated in the market, as a breakout in the highs could potentially trigger a close of the CME gap, trapping traders and setting up bearish divergences. The key level to watch is $28,700, 

Scenario 1 it is for #Bitcoin.

Heavily interested to see the outcome of tomorrow.

Potential sweep into the highs, closing CME gap, trapping everyone & creating bearish divergences is an ideal concept.

Key zone $28,700. pic.twitter.com/nLYjaJQxJX

— Michaël van de Poppe (@CryptoMichNL) March 21, 2023

Analyst and venture capitalist Chris Burniske said that Bitcoin is now trading above the 200-week simple moving average, an indicator that signals long-term trends. 

Burniske believes that testing the 200-week SMA as support bodes well for Bitcoin’s future price action. “Even if we consolidate for a bit, BTC convincingly cleared and closed back above the 200W SMA (yellow) – having that as support again would be beautiful.”

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