Bitcoin wobbles around $39K as Fed confirms up to 1% key rate target next

Bitcoin wobbles around $39K as Fed confirms up to 1% key rate target next

Bitcoin struggles to get back above $4000 as the Fed confirms today’s rate hike. The volatility of Bitcoin has been a result of its limited supply, which is not expected to last much longer. Experts are speculating how Bitcoin will fare if it manages to break through this resistance level and reach 5-6k in the coming months.,

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The “fed meeting outcome today” is the Federal Open Market Committee’s decision to leave interest rates unchanged. The Fed has confirmed that they will be raising the key rate by up to 1%.

Bitcoin wobbles around $39K as Fed confirms up to 1% key rate target next

On May 4, Bitcoin (BTC) remained virtually unchanged around $39,000, as the US Federal Reserve met forecasts for a 0.5 percent key interest rate rise.

Bitcoin wobbles around $39K as Fed confirms up to 1% key rate target next1 hour candle chart of BTC/USD (Bitstamp). TradingView is the source of this information.

Bitcoin is unusually quiet in response to the Fed’s comments.

As the Fed verified what many felt had already been “priced into” markets, data from Cointelegraph Markets Pro and TradingView showed BTC/USD displaying little change.

Unlike earlier statements from the Federal Open Markets Committee (FOMC), the May 4 announcement did not cause significant market turbulence. Traders had to deal with a temporary spike to little about $39,500 at the maximum.

Bitcoin was trading at comparable levels throughout the day at the time of writing.

The FOMC reaffirmed in an official statement that “with appropriate firming in the stance of monetary policy, the Committee expects inflation to return to its 2 percent goal and the labor market to remain solid.”

“In order to achieve these objectives, the Committee agreed to raise the federal funds rate target range to 3/4 to 1%, with the expectation that further increases would be appropriate. In addition, as outlined in the Plans for Decreasing the Size of the Federal Reserve’s Balance Sheet that were announced in connection with this announcement, the Committee decided to begin reducing its holdings of Treasury securities, agency debt, and agency mortgage-backed securities on June 1.”

However, the possibility of volatility remained, since Fed head Jerome Powell has still to speak an hour after the announcement was released. 

In response to Powell’s remarks, on-chain analytics resource Material Indicators claimed that being long BTC on shorter timescales was still not profitable.

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Giving the #BTC trend the benefit of the doubt, previous bull reversals had stronger bid volume and depth than what we see currently. If you’re long, you’ll need either a long-term perspective or a tight stop. Powell has 30 minutes to talk. https://t.co/VzE3V2kA8Q #MayThe4thBeWithYou pic.twitter.com/sp1kqDRBrz

May 4, 2022 — Material Indicators (@MI Algos)

Stocks, which continue to have a strong association with crypto, were in a good mood because to the Fed’s lack of surprise movements.

The S&P 500 put in a modest bounce to trade up 0.4% at the time of writing, while the Nasdaq 100 gained a more modest 0.2%.

“The Federal Reserve raised rates by 0.50 percent, but also began Quantitative Tightening on June 1st. Everything is as predicted, albeit QT begins a little later. The cost of the event has already been calculated “Parts of Twitter comments were added by Cointelegraph writer Michal van de Poppe.

“Tighten till something breaks,” says the adage.

Others were less enthusiastic about the Fed’s strategy.

Bitcoin is impatiently awaiting the Fed’s decision, while Paul Tudor Jones declares that he ‘obviously does not hold’ equities and bonds.

When economist Lyn Alden examined the implications of the priced-in raise, she suggested that the risks were pointing toward a new crisis-like period, with hikes posing severe hazards of their own.

All of this is subject to change depending on economic and financial circumstances.

Basically, tighten until something breaks.

May 4, 2022 — Lyn Alden (@LynAldenContact)

Meanwhile, on the subject of inflation, Alden said that the globe is seeing the “largest gap” between inflation numbers and central bank key rates since World War II.

According to Cointelegraph, Bitcoin’s future is still biased to the negative, with a later rebound as equities suffer from Fed tightening.

The author’s thoughts and opinions are completely his or her own and do not necessarily represent those of Cointelegraph.com. Every investing and trading choice has risk, so do your homework before making a decision.

The “fed crypto news” is the Federal Reserve confirming that they will be increasing their key rate target to 1%. This has caused Bitcoin’s price to fluctuate around $39K.

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