Thursday Breaking News: BTC Reacts to FED Meeting

In the aftermath of the Federal Reserve’s FOMC (The Federal Open Market Committee), BTC dropped in prices, after initially rallying leading up to the Fed Meeting.

In the words of the Fed, “With inflation well above 2 percent and a strong labor market, the Committee expects it will soon be appropriate to raise the target range for the federal funds rate.

On this news, the US Dollar Index (DXY) is rising to not-before-seen levels, breaking the price ceiling last set in June 2020. S&P 500, on the other hand, is struggling to hold on to its 50-week exponential moving average (EMA) at around $4,400, seemingly also suffering from overall bearish sentiments.

However, not all investors are panicking at the sight of the Fed’s intentions to combat inflation and reduce the speed of which they are printing money at the moment. Bitcoin analyst Michael Schmidt points out that the Fed has talked about tapering inflation for quite some time, yet its bond purchasing still keeps steadily climbing.

In addition, Raoul Pal, the CEO of Real Vision Group, also said that interest rate hikes aren’t always bad for market conditions. Specifically, he mentioned that if the yield curve inverts, then it spells market recessions internationally. Even though yield curves have yet to invert, it is starting to flatten, which puts pressure on the Fed to delay raising the Federal Funds Rates, at least until June this year.

Bitcoin made a massive rally at the end of day today, climbing from $35,646 all the way to $37,345 in a 3-hour window. However, it is still down nearly 50% from its all-time high, due to the recent crypto market crash.

BTC price chart over the past 24 hours (15-minute intervals)

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