Recent changes in Bitcoin prices and Fed statements have drawn analysts' attention. Let's examine how these factors might affect the cryptocurrency market.
Current Bitcoin Price Situation
At the time of this writing, the price of Bitcoin has fallen to $97,335 after being above $100,000 just a few hours earlier. Such fluctuations are not new to the cryptocurrency market and do not surprise market participants much.
Latest Fed Statements
Recent data have worsened scenarios for double Fed rate cuts this year. Although yesterday's inflation data was relatively calm, a series of poor reports raise fears that rate cuts will be delayed. Key highlights from Waller's statements include:
- December’s inflation data was very positive. - If trends persist, rate cuts might commence in a few months. - Three or four rate cuts might be possible this year if data supports it. - Inflation has been close to target for three of the last eight months, fostering hopes for further declines.
Market Reaction and Potential Scenarios
Waller's comments have sparked a new wave of speculation about future rate changes. The futures market began pricing in potential rate cuts by May. Unless significant Bitcoin news emerges soon, an upward trend may continue.
In the coming days, pressure from the U.S. on cryptocurrencies is expected to ease. The market's attention is focused on Fed meetings that will determine future movements in both cryptocurrency and traditional financial markets.
