Investor Pessimism Hits Bitcoin and Ethereum Ahead of Fed Meeting
As the Federal Reserve meeting approaches, pessimism among investors has strongly impacted Bitcoin and Ethereum. Bitcoin has seen a 7.6% drop, while Ethereum is down by 6% in the last 24 hours.
Market Response:
The Bitcoin price is currently at around $57,000, and Ethereum is hovering just under $2,900, according to CoinGecko data. The market volatility has led to the liquidation of $457 million worth of crypto futures positions in the past day, with $392 million of those being long contracts.
Impact Beyond Top Coins:
- Price drops have affected a wide range of cryptocurrencies, not just Bitcoin and Ethereum.
- Out of the top 100 coins, only a few have managed to avoid the negative trend.
- Stablecoins like Tether (USDT) and USDC have held their pegs, providing stability in the market.
Fed Meeting Expectations:
The U.S. Federal Open Markets Committee is set to announce its interest rate decision today at 2 p.m. ET, followed by a press conference with Fed Chair Jerome Powell at 2:30 p.m. Traders were anticipating a rate cut in May, which typically benefits risk assets like Bitcoin.
Inflation Concerns:
The Fed’s current key interest rate is at 5.25% to 5.5%, aiming to control inflation. Inflation is currently at 3.5%, well above the target of 2%. Despite hopes of rate reductions, inflation has been on the rise, reaching its highest level in months.
Global Interest Rate Trends:
In March, the Swiss Central Bank reduced interest rates to address inflation concerns. However, this move has not been replicated by other major central banks. Traders initially expected a rate cut in June from the Fed but now anticipate it may not happen until December.
Hot Take: Stay Informed Amid Market Volatility
Amid market fluctuations driven by investor sentiment and upcoming central bank decisions, it is essential to stay informed about the latest developments. Keep a close watch on market trends and news to make informed decisions in this volatile environment.
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