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Bitcoin Price Consolidation
The Bitcoin (BTC) price is consolidating in the mid-$57,000s, down roughly 5% on the day, though up around 1.5% or $1,000 from earlier session lows as traders weigh the outlook for Fed rate cuts this year in wake of the latest policy announcement from the US central bank.
Fed Policy Announcement
As anticipated, the Fed left interest rates at multi-decade high levels of 5.25-5.5% and slowed its balance sheet run-off. The central bank will now allow its portfolio of assets to shrink by only $25 billion per month, a reduction larger than some investors anticipated.
Market Reaction
Bitcoin briefly pushed to the mid-$59,000s, and US stocks pumped, though these moves quickly reversed. Currently, Bitcoin is trading roughly in line with pre-announcement levels.
Fed Chair Comments
Fed Chair Jerome Powell noted recent higher-than-expected inflation data readings and mentioned that gaining confidence to cut interest rates will take longer than expected.
Market Interpretation
The market interpreted the Fed meeting as slightly more dovish than expected, explaining the Bitcoin price bounce from lows.
Bitcoin Price Forecast
While Bitcoin may have recovered from earlier session lows, recent technical developments suggest more downside is coming. Analysts predict BTC will hit the low $50,000s, with the next major support level at $53,000.
Analyst Predictions
Standard Chartered predicts a 13% drop to $50,000, citing macro drivers slowing down. Other analysts mention the importance of the average entry price of US Bitcoin ETF buyers at $57,300.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
