Bitcoin's value stabilizes around $118,000 prior to the FOMC gathering, while BONK experiences a significant drop: Market Update
Headline: Cryptocurrency Markets Brace for Volatility Ahead of FOMC Meeting
The cryptocurrency market is gearing up for potential volatility as the US Federal Reserve prepares to announce its decision on interest rates later today. The recent meeting saw the Fed holding rates steady at 4.25% to 4.5%, signalling a pause in rate increases amid inflation at 2.7% in June, the highest since February.
The decision and Fed Chair Jerome Powell's comments about awaiting more data before adjusting rates further could influence investor sentiment across markets, including cryptocurrencies. Generally, a continued pause or dovish stance can boost risk assets like Bitcoin and other cryptocurrencies, as lower rates reduce borrowing costs and increase liquidity. Conversely, indications of future rate hikes or tightening monetary policy tend to weigh on speculative assets, including crypto.
Given the latest meeting's pause in rate hikes with cautious forward guidance without major surprises, the immediate impact on Bitcoin and the crypto market is expected to be neutral to mildly positive. However, crypto markets remain sensitive to inflation data, geopolitical risks, and overall market sentiment, so volatility around the meeting and Fed Chair Powell’s press conference is likely.
In the past two weeks, the bears have prevented Bitcoin from surging toward its all-time high. On Monday and Tuesday, Bitcoin dropped below $117,500 on a couple of occasions. Currently, Bitcoin's price has stabilized around the $118,000 mark. Other notable cryptocurrencies have also marked substantial losses. BNB, SOL, DOGE, ADA, HYPE, XLM, and LINK have all seen losses, with Bitcoin's rival, Ethereum, approaching $3,800 after a 1.6% drop.
Altcoins such as SUI, HBAR, AVAX, ENA, TAO, and ICP have also experienced substantial losses, with each coin seeing over 5% daily declines. XRP has slipped toward $3.1 following a 2% decline. The total crypto market cap has decreased by $60 billion overnight, now standing at $3.940 trillion on CoinGecko.
Amid this volatility, investors can stay informed by signing up for a daily market update for free. This will help them navigate the crypto market and make informed decisions about their investments. It's important to remember that while the FOMC meeting is a significant event, the crypto market is influenced by a multitude of factors, and volatility is a common occurrence.
In summary, the no-change and balanced Fed tone may support Bitcoin and crypto prices moderately. Any hawkish signals in coming data or September meeting commentary could pressure cryptocurrencies. Crypto remains vulnerable to shifts in Fed policy and macroeconomic data influencing risk appetite.
- Amid the approach of the FOMC meeting, the cryptocurrency market, including Bitcoin, altcoins like Ethereum, and others such as BNB, SOL, DOGE, ADA, HYPE, XLM, and LINK, is bracing for potential volatility, with Investors keeping a close eye on the Fed Chair Jerome Powell's comments.
- Higher interest rates or tight monetary policy could weigh on speculative assets like Bitcoin, Ethereum, and other cryptocurrencies, whereas a continued pause or dovish stance may boost their prices as lower rates reduce borrowing costs and increase liquidity.
- Although the recent FOMC meeting indicated a pause in rate hikes, the immediate impact on Bitcoin and the crypto market has been expected to be neutral to mildly positive, with crypto markets remaining sensitive to inflation data, geopolitical risks, and overall market sentiment.
- Investors navigating the crypto market can stay informed by signing up for a daily market update, helping them make informed decisions about their investments in Bitcoin, Ethereum, altcoins like SUI, HBAR, AVAX, ENA, TAO, ICP, and others, as the market's volatility and vulnerability to shifts in Fed policy and macroeconomic data continue to influence risk appetite.
