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Bitcoin (BTC) has been trading around $19,400, essentially unchanged over the previous 24 hours and down 5% over the past week. Now that the market has moved past “The Merge,” cryptocurrency prices are once again closely tied to inflation and interest rate dynamics.
Bitcoin Price Predictions Prior to FOMC Meeting
The FOMC meeting of the U.S. Federal Reserve (Fed) will take place later today, and the Fed is expected to announce an increase in interest rates at that time. The crypto market is likely to experience more volatility in the lead-up to this significant event, as has been the case over the previous month.
After the most recent readings on inflation and employment, the market appears to have priced in another 75 basis points of rate hike. According to trading desk QCP Capital, these studies’ findings pointed to ongoing core inflation in the US currency.
The company forecasts that today’s interest rate rises, the Federal Reserve’s future monetary policy, and the market’s reaction to inflation will all be major factors. That’s why today’s FOMC meeting is so important for giving investors more context on the Fed’s plan.
The trading department projected that the Dot plot would receive the most attention in their report. For the remaining three FOMC meetings of 2022, investors will be looking for specifics on how many rate increases are projected, as well as any changes to the terminal rate that the FOMC expects to implement in 2023.
The Bitcoin price and the crypto market have shifted to high anxiety levels without “The Merge” serving as a bullish catalyzer, and with Ethereum trading under a “sell the news” arrangement. This outlook appears to be universal in the banking industry.
QCP Capital noted that even gold has a strong relationship to risky investments. Despite soaring inflation and a significant armed war in Europe, the precious metal has underperformed (Russia invading Ukraine).
A Rebound In Bitcoin’s Price Is In The Works?
QCP Capital thinks Bitcoin and the cryptocurrency market may be able to breathe a sigh of relief soon. Cryptocurrencies and other asset risks may rise if the Federal Reserve announces an interest rate hike in line with market forecasts (75 basis points).
Every FOMC meeting in 2022 has been followed by a relief rally in cryptocurrencies, and this meeting seems like it will follow suit, as noticed by a trading company. How long this surge lasts, QCP Capital noted, is an open question. Is it going to be another one-day short squeeze like May and June, or something more prolonged? Alternatively, they may be able to carry their recent upswing into Q4 and the next CPI turn in three weeks. Nothing but time shall tell.
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