Crypto markets received a boost last week, as the outcome of the Fed monetary policy was perceived as dovish. The Federal Reserve raised interest rates by only 25 basis points, bringing the benchmark interest rate to a target range of 4.50% to 4.75%.
Fed rhetoric this week was hawkish, albeit cautiously so, and risk markets wavered. On Tuesday, Fed Chair Jerome Powell confirmed that the disinflation process has begun but emphasized that it still has a long way to go. On Wednesday, FOMC member Williams emphasized that for a few years, a restrictive stance must be maintained, but did not commit to a specific ceiling for the Fed’s interest rates this year. Fed’s Cook on Wednesday was more hawkish, stating that the central bank aims to restore price stability, which will require a restrictive monetary policy for some time. Rate hikes have become less aggressive, but the Fed might continue raising interest rates for longer than previously expected.
Bitcoin price dropped to $22,800 on Wednesday. If the BTC price declines, support can be found near $22,390, while further resistance may be encountered near $25,000.
Ethereum price also edged lower on Wednesday, dropping to $1,640. If Ethereum's price declines, it may encounter support near $1,518, while if it increases, resistance may be encountered near $1,789.
Global cryptocurrency market capitalization has started to recover this year and remains above $1 trillion. Crypto bulls are hoping that the recent cryptocurrency selloff has passed and that market confidence in the industry will be restored. Bears are fighting back, however, pushing cryptocurrency prices down.
BTC/USD 1h Chart
ETH/USD 1h Chart
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