There are only hours left to the FED meeting, which is closely related to the crypto money markets. As we have constantly experienced in previous meetings, Bitcoin can experience sudden movements during the minutes when the statement comes and Powell speaks. For this reason, we can say that volatility may increase in the following hours.
When is the Fed Rate Decision?
The meeting starts today and will continue tomorrow. On Wednesday, January 26, at 22:00, the FED will announce its meeting decision and will satisfy the curiosity about the interest rate hike. Half an hour later, on Wednesday, at 22:30, Powell will be in front of the screen. The explanations he will make here are extremely important and Bitcoin can make sudden movements depending on the sentences he makes.
Bitcoin made a new low at $ 32,900 just 24 hours ago, and rose again to $ 37,000 in the evening. We can see similar movements today and tomorrow.
How Will Bitcoin and Altcoins Be Affected?
Especially after the pandemic, cryptocurrencies experienced significant rises as the FED and other central banks around the world pumped serious money into the market. However, the statements made at the last meeting tell us that this is over. The FED also reduced its asset purchases at the last meeting and announced that it would be reset in a short time.
The continuation of the rapid decrease in asset purchases may also delay the 3 expected rate hikes this year. In a scenario where inflation is 7%, an increase in interest rates by 0.25 points will not create a serious demand for bonds.
Expectations of the Fed Meeting;
No rate hike is expected at this meeting.
We can hear the concrete decisions regarding the reduction of the balance sheet at this meeting.
The sharp fall of the stock markets may push the FED to act more moderately. Of course, this will be in favor of Bitcoin.
In the March meeting, signals may be given that an interest rate hike will be made.
Cryptocurrency markets seem to have already priced in a possible interest rate hike in March. Although future statements may cause sudden fluctuations, they may not have a permanent negative effect on the price. We witnessed that short and long position holders who opened margin trades at the meetings were reversed at the same time. Opening a position close to the meeting time can cause you serious losses.