The Cryptocurrency market is currently trading sideways as a few currencies are waving red while others are trading on a green note.
Bitcoin bulls and bears clashed as the FOMC meeting gears up for today’s meeting, May 4. The price of Bitcoin has fallen and is hovering around $38,000.
FOMC Impact On Crypto
It’s just not Bitcoin, even altcoins have consolidated on a bearish note and are just waiting for the next bull run. However, investors are carefully watching the upcoming Federal Open Market Committee (FOMC) conference.
Cryptocurrencies have been trading in this bear market for two days as uncertainty clouded the crypto space ahead of today’s FOMC meeting.
Jerome Powell, Federal Reserve chairman will declare if there will be any quantitative tightening where the rates will be increased.
Many analysts have different opinions and one such analyst who tweeted his opinion is
Today’s meeting will give us a clear picture of the upcoming monetary policy measure updates. The Federal Reserve’s announcement in March’s meeting had a declaration that the economy had dropped by 1.4% in Q1, which pointed toward recession.
Economic measures are always taken with the aim of controlling the recession and a hawkish approach by the FED will attract increased interest. This will in turn drive the crypto market causing a downtrend for Bitcoin landing at $30,000.
On the contrary, if the FED decides to have a kind approach, then the interest rate hikes will drop more than 50-basis points. If this happens then this will act in favor of the crypto market attracting more investors.
Although the FED announced a rate hike in March, this decision did not result in much decline as the market was already in control of the declines.
How Is the 2017 FOMC Similar To That Of Now?
In September 2017, there was a similar announcement made during which Bitcoin fell drastically after FED’s quantitative tightening measure announcement. However, there was a strong bullish rally later.
Therefore, things look the same this time, considering that Bitcoin and Ethereum have already been in a bearish cycle for a month. However, if Bitcoin is forced to the upper end, there will still be a risk of a downside pull and this will lead to investor emotions triggering a low volume range.
