Bitcoin ( BTC ) price popped to the upside following FOMC confirmation that the Federal Reserve would leave interest rates unchanged from its current target range of 4.25% to 4.5%.
Although Fed chair Jerome Powell and policymakers conceded that inflation remains “somewhat elevated,” the central bank chose to take a wait-and-see approach, leaving all options open regarding its monetary policy in the short term.
At the outset, Bitcoin price declined alongside the SP 500, DOW and QQQ before reversing course to hit an intra-day high near $104,782, but charts suggest that the move is likely to fade. Data from Velo.data shows the price move was primarily driven by activity within the futures market where an uptick in Bitcoin’s funding rate happened as traders positioned short were liquidated to the tune of $15 million over the past hour.
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BTC/USDT futures 1-hour chart. Source: Velo data
Despite the push-up into BTC’s $104,000 to $106,000 resistance zone, what remains to be seen is a sustained uptick in spot buying and the return of the oft-cited Coinbase premium. Ideally, a surge in margin longs accompanied by increasing volumes in spot markets would be the type of market action required to support price acceleration above $105,000.
Regarding Powell’s post-FOMC comments and his view of the US economy, the bulk of his statements aligned with the expectations of market participants. Economist and popular crypto trader Alex Krüger described the press conference as “good,” citing Powell’s optimism “on both policy and the economy.”
“The FOMC statement had removed mention of progress towards inflation, generating a bear trap before the conference.”
Pear Protocol founder and former TradFi trader HUF said,
“Bit of a nothing burger FOMC press conference. Not dovish, not hawkish. Walking a very diplomatic line, and I think the market was expecting Powell to be more vocal about Fed independence and he clarified that there was nothing hawkish about removing the written language about “inflation making progress.” Powell didn’t really give anything for bears, and bulls took this as an opportunity to squeeze aggressive shorts.”
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
