Intraday volatility shows that traders panicked for brief moment after data release
Intraday volatility on bitcoin on the FOMC for the day reached previously unseen levels, as the regulator’s decision was one of the most expected events for the cryptocurrency market since July, mysterious research Report.
The last time the market saw such a rapid spike in volatility was the CPI data release in September that brought us unexpectedly high inflation numbers which, as it seemed at the time, should have been tamed already.
As the market faced an unpleasant reality, financial regulators were left with no option but to keep monetary policy tight and raise the key rate gradually. Each rate hike by the Fed adds to the pressure on the cryptocurrency market, which is why we are seeing a volatility spike after every FOMC meeting.
Since there was no FOMC meeting back in August, September’s meeting results created more volatility than usual. However, the expected 75 bp hike did not cause any pain on the market, which is why we are not seeing any irregular movements on the chart.
However, the CPI data was unpredictable by the cryptocurrency market, with short-term BTC holders leaving most of their holdings in the market and causing a massive 10% drop.
The next two events that should cause another volatility spike are expected to be October’s CPI release on the 13th, and the FOMC press conference on November 2, where the regulator will share its decision. The market’s consensus is yet another 75 bp hike.
