Bitcoin’s performance that we saw two days ago is drastically different from what we are seeing on the market today. The price of the first cryptocurrency tumbled below the $17,000 threshold after the FED announced yet another 50 bps rate hike that, for whatever reason, has been considered as a positive factor prior to Jerome Powell’s press conference.
In the last few hours, Bitcoin has reached the $17,000 price threshold once again, despite rallying to almost $18,500 a few days ago. Such a price performance was a reaction to an upcoming 50 bp hike, after a series of 75 bp hikes.
Despite the deceleration of the rate hike cycle, the FED is still executing a strict monetary policy that in no way can be favorable for assets like Bitcoin or cryptocurrencies in general. The market’s positive reaction to the upcoming decision of the Fed has been irrational, despite the decreasing inflation.
Even without the FUD around Binance, the digital assets market has been struggling with massive outflows and almost nonexistent inflows into the industry from both retail and institutional investors.
The price of the digital gold was moving in the same trading range for the last two months, which is a critical factor for highly volatile and speculative assets like Bitcoin that attract a major portion of the trading volume from being a great volatility exposure tool.
Unfortunately, the short-term future for the cryptocurrency market looks grim, and markets are struggling to find ground to bounce off of, considering the lack of drivers that would make investors push more funding to the industry, especially after the implosion of FTX.
Source: https://u.today/market-update-bitcoin-btc-extremely-close-to-breaking-down-to-16000-range