Bitcoin shakes Fed volatility as analysts still share profits below $ 24,000

On May 18, bitcoin (BTC) rose $ 30,000 after further comments from the US Federal Reserve, which caused volatility.

BTC / USD 1 hour candlestick chart (Bitstamp). Source: Trading View

Analyst: Further increase in the Fed rate is the biggest risk

Data from Cointelegraph Markets Pro and TradingView showed that BTC / USD is consolidating in the range effective from May 12.

The couple divorced when Fed Chairman Jerome Powell briefed on economic policy at the Future of Everything festival in the Wall Street Journal.

“I don’t know if financial conditions have tightened over a very long period of time,” he told Nick Tiraaos, the newspaper’s chief economic correspondent.

Powell confirmed that the increase in key interest rates by 50 basis points will continue at the next meetings of the Federal Open Market Committee (FOMC) of the Fed and may reach a “neutral” level in the fourth quarter. However, further increases may be continued if necessary to further curb inflation.

Because traditional markets were already pricing in this scenario, overall volatility was limited as Powell avoided surprises.

BTC / USD briefly fell to $ 29,500 before recovering from Powell’s remarks.

However, as risky assets are forecast for difficult times as the financial crisis continues, cryptocurrency market commentators have little to offer very optimistic news.

‚ÄúRemember the falcon. This is the biggest risk for the markets, “macro-analyst Alex Krueger said in a series of Twitter posts about the potential for higher rates next year:

Every Fed official sees differently what “neutrality” is. It is estimated that from 2 to 3%. Now prices in futures markets in December were 3.25%.

According to the FedWatch tool from the CME Group, markets expect the target rate to be between 275 and 300 basis points at the December FOMC meeting.

Chart

Expectations of the target rate for the FOMC meeting in December 2022. Source: CME Group

Then $ 33,000 “makes sense.”

In the short term, some have seen continued relief for BTC.

“It closed well above the $ 28.8,000 range, as well as the $ 30,000 low, marking the initial drop in oppression in May 2021. The next resistance in HTF is the $ 33,000 area. In my opinion, the test in this area makes sense, “- summed up the popular trading account Daan Crypto Trades in its latest update, focused on bitcoin.

Another account, DonAlt, meanwhile, said $ 34,500 was an obstacle to a more optimistic BTC forecast.

The growing number of players, according to Cointelegraph, is still in favor of a return below the low of $ 23,800, which was observed last week at the peak of the fall of Terra LUNA and TerraUSD (UST).

“Funds need time to form, so don’t expect them to form in a day or two,” crypto trader Tony told Twitter readers.

We will probably find support, bounce back for some relief and fix the lagging shorts and continue the trend.

Others, meanwhile, believe $ 20,000 for retirement is unlikely.

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