Not even the Fed moves Bitcoin

Yesterday, the Federal Reserve (Fed) left interest rates unchanged, thus causing a null impact on the price of Bitcoin. 

Subsequently, there was the usual press conference by President Jerome Powell during which he outlined the current situation and future forecasts. 

Very often these two events, namely the announcement of the Fed’s rate decision and the press conference of its chairman, impact the trend of the price of Bitcoin, but yesterday from this point of view nothing happened. 

The anomaly in the price of Bitcoin: not even Powell from the Fed moves it

There is indeed an ongoing curious anomaly in the trend of the price of Bitcoin.

From May 31 until today, the emotion seems to have disappeared from the market of BTC.

In reality, on May 31st it decreased significantly, and starting from the day before yesterday, it has practically disappeared completely. At this precise moment, there is no excess of emotion affecting the price of Bitcoin, because there is no sign of any bull enthusiasm or bear fear.

It is a real anomaly, because usually the crypto markets are very emotional. 

It must be said that there is still a bit of residual emotion on other crypto, but there isn’t much, and it only concerns a part of the crypto market.

On Bitcoin, however, since the day before yesterday, it seems to have completely vanished. 

The really curious thing is that the current price of Bitcoin is still very close to the all-time highs from about a month ago (-6%), and this makes it really difficult to understand how the emotion could have completely disappeared. 

The Dollar Index (DXY)

The trend of Bitcoin’s price tends to be inversely correlated to the Dollar Index in the medium term. 

The Dollar Index (DXY) is the index that measures the strength of the US dollar against a basket of other global currencies, and is therefore obviously influenced by the decisions of the US central bank.

In fact, the actions of the Fed often have an effect on the Dollar Index, both positively and negatively, and yesterday, for example, DXY rose from 98.6 points to 99 points just as Powell was speaking. 

The trend of Bitcoin’s price does not always follow the trend of the Dollar Index even in the short term, but yesterday it followed it even in the very short term, so much so that while DXY rose slightly, BTC fell slightly. 

In the end, yesterday the price of Bitcoin opened the day at around $104,500, and closed it around $105,000, with a minimum peak at $103,500 and a maximum at $105,600. In fact, it moved sideways, despite the Fed. 

The announcements from yesterday by the Fed

Yesterday, the Federal Reserve announced that it wanted to maintain the upper limit of rates at 4.50%, in line with expectations. 

During the press conference, President Powell described a picture only slightly worse compared to last month, despite the tariffs, and overall still decidedly good. 

On the contrary, he has repeated many times the concept that the current phase is primarily characterized by uncertainty, particularly regarding the future impact of tariffs on prices (and therefore on inflation), and in such a scenario, the Fed is not able to make solid forecasts to make decisions based on them. 

And so he limits himself to observing the real data already available, and makes his decisions based only on the present and not the future. In fact, he cannot do otherwise, because his mandate excludes it. 

Moreover, it has emerged that internal consensus within the FOMC regarding rate cuts from now until the end of the year is decreasing, although overall the average orientation still seems to focus on two cuts of 25 basis points. 

The markets yesterday were not at all caught off guard by what Powell said, because in such a situation of uncertainty no one is really able to predict the future, so it’s as if they are all of the same address, precisely because they lack a true address.