Post FOMC meeting, and Fed Chairman Powell’s talk of not having to make a cut in March has perhaps led to lower stock market prices, and also a continued bleed-out in the crypto market.
An unlikely rate cut in March
When Jerome Powell made his speech at the end of day two of the FOMC meeting, he would have been very much aware that he could not afford to give the market too much hope that rate cuts would begin in March. The Fed Chairman said:
“Based on the meeting today, I would tell you that I don’t think it’s likely that the committee will reach a level of confidence by the time of the March meeting to identify March is the time to do that,”
The Chairman added:
“We’re not really at that stage, there was no proposal to cut rates. … We weren’t actively considering moving the federal funds rate down,”
With this kind of jawboning, Powell has perhaps managed to keep the lid on the market. The reaction has been a red day so far on the traditional stock markets. The S&P 500 Index is down 1.6%, and the Nasdaq 100 Index is down nearly 2%.
Crypto market in the red
For crypto, bitcoin is down around 1%, and the rest of the altcoins are also generally down across the board. Outflows from the Grayscale Spot Bitcoin ETF are still being at least matched by the inflows into the other ETFs, and so the massive selling pressure of a couple of weeks ago has certainly subsided.
That said, there doesn’t appear to be any major catalysts for the market to go one way or the other. In fact, market sentiment could be the main factor driving price currently.
Fear is still in the crypto market, given that many are still probably waiting for a further dip which will turn this present correction into a more respectable one, with an increase to at least 30% to the downside.
$BTC is hanging on, but barely so. At the time of going to press, the price is pressing through the bullish trend line. If $BTC does make this break down, an extended period below $40,000 could follow.
Across the rest of the crypto market most altcoins are slightly in the red. Render (RNDR) is one of the only exceptions; up more than 6% on the day so far.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
Source: https://cryptodaily.co.uk/2024/02/bitcoin-in-the-red-after-talk-of-interest-rates-remaining-higher-for-longer