Why Bitcoin Could Trade Above $22,000 After Today’s FOMC Meeting


Bitcoin is preparing to face volatility during today’s trading session. The cryptocurrency market is preparing for the US Federal Reserve (Fed) FOMC meeting which could lead to no event or push risky assets lower.

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During this meeting, the Fed is expected to announce a rate hike. According to trading desk QCP Capital, the market has ruled out the possibility of a 100 basis point increase.

Market participants expect 75 basis points that if the Fed meets expectations, Bitcoin and other digital assets are likely to resume their upward momentum. QCP Capital He said:

Every FOMC meeting this year has seen an immediate positive reaction from the market for the interest rate decision. We expect the same for this.

Additionally, the trading firm claims that there is potential for further upside based on the Fed’s adoption of a “one-time 75 basis point” increase. In the future, the financial institution may return to 50 basis points on the back of slowing inflation measures.

To contribute to this theory, US public company earnings season has missed expectations without major surprises thus far. Tomorrow July 28The tenthApple and other major technology companies are expected to publish their earnings reports.

If there are no major surprises, the cryptocurrency market should benefit from the FOMC meeting and from the comfort of the old financial markets. Regarding the latter, QCP Capital indicated:

With the risk of over-optimistic feeding off the road and inflation slowing, we believe the markets will continue to be supported by previous bottoms providing a base (BTC at 17600 and ETH at 880).

The post-FOMC rally may be short-lived as Bitcoin and the cryptocurrency market continue to see high selling pressure from miners. In this sense, QCP Capital expects sideways movement in the short to medium term.

What could lead to more negative pressure?

The trading company believes that there is a wild card that has the potential to negatively affect global markets. It is clear that US Representative to Congress and Speaker of the House Nancy Pelosi is planning to visit Taiwan.

If the visit ever materializes, there could be an escalation in tensions between the United States and China. QCP Capital said:

August tends to be quieter with the United States and Europe in summer vacation. If tensions worsen, we could see a move away from risk into thin liquidity. From a volatility perspective, all this year’s FOMC has been a disappointment.

Related reading | TA: Bitcoin price consolidation, why the recovery can be put to an end

At the time of writing, Bitcoin (BTC) is trading at $21,400 with a gain of 3% in the last 24 hours.

Bitcoin BTC BTCUSDT
BTC price trends are down on the 4-hour chart. source: BTCUSDT TradingView





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