What effect does the results of the meeting of the Federal Free Market Committee have on the price of Bitcoin and Ethereum?
Bitcoin and Ethereum, the two leading digital currencies of the market, managed to maintain their prices above the levels of $24,000 and $1,600. However, on Monday (February 22), both experienced a slight decrease; For example, the price of Bitcoin returned from $25,000 to the $24,000 channel.
According to Wallex and quoted by Crypto News, investors are looking at the minutes of the Federal Open Market Committee (FOMC) meeting, which is scheduled to be published this week.
Recent positive economic data from the United States has reinforced the belief that the Federal Reserve will continue with its plan to maintain current monetary policy for a little longer than expected.
Another event that could be of interest to investors is the release of licensing requirements for virtual assets in Hong Kong, which has recently legalized digital currencies.
The release of the minutes of the Federal Open Market Committee meeting on Wednesday (February 22) could affect the price of Bitcoin. Considering the decisive role of this committee on the monetary policy of the United States, any hint of change in this policy can have a deep impact on the markets, including the digital currency market.
In the recent speech of Jerome Powell, the chairman of the Federal Reserve, he expressed his confidence in the ability of the Federal Reserve to reduce the inflation rate to the target level of 2%. In Powell’s response, there was no change in the central bank’s approach to the strong jobs report in January, but he warned that if positive employment rates persist for a long time, the Federal Reserve’s final interest rate may be higher than initially estimated.
At the February meeting, the Federal Reserve increased the range of interest rates by 0.25%, which has now increased the interest rate to 4.5% to 75.4%. This is the second consecutive meeting in which the rate of interest rate increase is reduced. However, the cost of borrowing is now at its highest level since 2007.
On the other hand, the US dollar has shown its strength due to recent economic developments and has strengthened against other currencies.
The market anticipates that interest rates should rise due to recent economic data showing persistent inflation, a competitive labor market, strong growth in retail sales and rising producer prices. The market forecast indicates that the federal funds interest rate will reach its highest level by July – a little less than 3.5%. The view of the Fed chiefs is that higher interest rates are necessary to fight inflation.
The strong dollar index is known to be an important factor in reducing the market value of digital currencies.
If we analyze Bitcoin from a technical point of view, this currency is currently experiencing a side market and is fluctuating in a narrow range between $23,700 and $25,200. The initial resistance level for Bitcoin is currently located at $25,200 and if the price of Bitcoin succeeds in breaking this barrier, the next hurdle is at $26,000.
If the price of Bitcoin falls below the support level of $23,750, its next support will be in the range of $22,850. This range is near the 50% level of the Fibonacci indicator.
But the Ethereum analysis shows the upward acceleration of this currency after finding a relatively strong support near the $1,650 level. In the chart of Ethereum in the 2-hour time frame, a symmetrical triangle pattern has formed, which shows the uncertainty of the market.
If Ethereum is able to experience a retracement of the $1,650 support, there is a potential to reach $1,720. Crossing this level along with the mentioned triangle pattern can raise the price even up to 1760 and 1800 dollars.
On the other hand, Ethereum’s current support levels are at $1,650 and $1,625. MACD and RSI indicators are showing divergence. This means investors wait and procrastinate for the occurrence of an event or the release of important news such as the results of the FOMC meeting to determine the next trend of the market.
What is the effect of the results of the meeting of the Federal Free Market Committee on the price of Bitcoin and Ethereum? The first time in the blog Valx. appeared.