Bitcoin and the broader crypto market rapidly reversed course in response to the U.S. Federal Reserveโs announcement of a 50-basis-point increase in interest rates, erasing any gains made before the disclosure.
The Federal Reserve has been steadily raising interest rates in an effort to easeย the economy and rein in inflation, which has driven prices to record highs.
Yesterday, the Bitcoin price reached a one-month high and had a brief recovery of positive momentum, but a conservative report from the Federal Open Market Committee (FOMC) and remarks from Fed chair Jerome Powell drove BTC to an intraday low of $17,659.
A Whipsaw For Bitcoin After Fed Disclosure
According to TradingView data, the BTC price saw a bit of a whipsaw in response to the central bankย announcement, rising to an intraday high of $18,377 before falling to a low of $17,663 in a few of hours before bulls pushed it back up above theย $17,800 support.
Prior to Powellโs announcement, the key indexes were in the green zone; however, they plunged into the red zone after his announcement. At the close of trading, the Dow Jones, Nasdaq, and S&P were all in the red.
Powell told members of the pressย on Wednesday afternoon that โwe have more work to doโ and that โinflation risks are on the upside.โ
Coingecko statistics indicates at the time of writingย that Bitcoin (BTC) and Ethereum (ETH) values have fallen by more than 2.7% in the last hour and are presently trading at $17,717 and $1,292 apiece.
In the past 24ย hours, the market capitalization of all cryptocurrencies declined 1.42 percent to $857.98 billion, representing a decline of $85.72 billion. The overall crypto market volume during the past 24 hours has decreased by 14.40%, reaching $45.67 billion, based on latest data.
BTC total market cap at $341 billion. Chart: TradingView.com
What The Experts Predict For BTC Price
In its Crypto Outlook For 2023 report by Forbes Advisor, it predicts that Bitcoinโs price could decline to $13,560 in 2023, given that cryptoโs reputation has been severely damaged by the problems and scandals of 2022 and that broader markets are suffering.
Jim Wyckoff, a senior technical analyst at Kitco, has a different take: heย said that Bitcoinโs surge to $18,377 was a five-week high, which actually signals optimism in the cryptoโs price trajectory.
The markets fell from $20K to $15.6K due to the FTX collapse.
Weโre currently trading at $18K, slightly higher than the low in June.
I understand the bearish thesis, but this is honestly a sign of strength for #Bitcoin.
โ Michaรซl van de Poppe (@CryptoMichNL) December 14, 2022
According to Wyckoff, this weekโs price action has created a bullish โupside breakoutโ from a โchoppy and sideways trading rangeโ on the daily chart, indicating the emergence of a price upswing.
Other renowned analysts say that the market has already reached its bottom and that a Bitcoin relief bounce is in the offing.
The question that arises now is whether the current market turmoil will persist into the new year, and if so โ when the crypto winterโs frozen edges might begin to thaw.
