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What does the FOMC mean for the second quarter? 80K Next? –
Bitcoin price suffered a sharp decline to reach a three-week low of $66,170. Let’s dig in and explore how the Federal Reserve’s upcoming FOMC meeting could impact the Bitcoin market.
Tuesday was a disaster for crypto. Bitcoin price fell from $70,000 to $66,000, and now traders are holding their breath for Wednesday. CPI Inflation Report and the decision of the Federal Open Market Committee (FOMC).
As inflation falls and economic signals weakensome predict the FOMC will see rate cuts, while others say this crypto dump was artificial and we’ll pump like crazy this week.
Is it true? Are we going to get $70,000 back tomorrow?
Pre-FOMC Damage Assessment: Altcoins Hit Hard Before FOMC
As the FOMC approached, altcoins fell even more than Bitcoin. Ethereum fell below $3,500 and other big names like Solana, Dogecoin, Cardano and Chainlink fell between 6% and 9%.
Data from CoinGlass showed $250 million in leveraged liquidations following last Friday’s $400 million purge.
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So what are the chances the Fed will cut rates? Analysts at 99Bitcoin believe this is not likely.
Powell has repeatedly said rates won’t go down until people lose their jobs. Job numbers are on the rise now that everyone is forced to work multiple jobs, which means there’s no rate cut for you.
In addition, it must be taken into account that American rates are much higher than those of other countries. This gives the FED more room to lower rates while keeping rates higher than in Europe and Canada.
It’s possible the Fed won’t cut rates until something breaks.
There is hope on the FOMC side: could this trigger a strong third quarter?
One of the main reasons for the decline is that investors are “de-risking” ahead of May’s Consumer Price Index (CPI) report and Federal Reserve meeting, analysts noted. cryptographic k33.
“The stage is set for a frenzied macroeconomic Wednesday, with May CPI data and the Fed’s interest rate decision poised to move the market,” K33 analysts said .
The only hope is that people were calling for another delay on spot eth ETFs, and the Securities and Exchange Commission suddenly changed its mind.
Although the Fed and SEC are separate entities, this shows that the betting market is worthless.
The markets also thought we were going to make cuts in May. In the end, it’s just guessing.
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The bottom line: Is a bull run on the horizon for Bitcoin price?
If bullish momentum returns this week, based on current technical analysis, Bitcoin could be poised for a breakout rally. According to trend-based Fibonacci levels, BTC price could target $81,873 during a new bull run.
However, the upcoming FOMC meeting remains a double-edged sword for Bitcoin. Given the limited chances of a rate cut due to robust jobs data, we could continue to sputter for another month.
One last food for thought: the next FED meeting will not take place until the last week of July and it will not meet in August. This might encourage them to cut back on spending now.
But like we said, in the end it’s all guesswork.
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Warning: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose your entire capital.