Bitcoin has seen significant growth and reached two-week highs. Markets are reacting to the Fed’s decision to leave interest rates unchanged and speculation of a major update to US policy towards cryptocurrencies.
Fed reassures markets, bitcoin reacts with growth
At its latest meeting, the Fed confirmed its stable monetary policy and left interest rates unchanged. Fed chief Jerome Powell said that inflation has eased and there is no need to rush further action. Markets received the news positively, leading to a rise in risk assets including cryptocurrencies and equities. Bitcoin reached USD 87,500 on the Bitstamp exchange before consolidating near USD 86,000.
Former BitMEX CEO Arthur Hayes believes the Fed will end quantitative tightening as early as early April. According to him, bitcoin has probably found its bottom at USD 77,000, but he warns that stock markets could undergo another significant correction. The future direction of US monetary policy will be key, which may also affect President Donald Trump ‘s stance on cryptocurrencies.
The expected US announcement may affect the bitcoin market
Meanwhile, traders’ attention is turning to an expected US government announcement regarding cryptocurrencies, which could come as early as March 21. It is speculated that this will be the most significant change since March 6, when the National Cryptocurrency Reserve was created. Some analysts suggest that Trump could significantly adjust his strategy towards cryptocurrencies, which could have an impact on the entire market.
Technical analysis suggests that bitcoin is approaching key resistances. A Rekt Capital analyst warns that if BTC rises another 8%, it will regain control of the upper range of the trading range. Given that it has already added 13% since local lows, this scenario is increasingly likely. The market is now awaiting the Fed’s next steps as well as the US government’s announcements, which may influence bitcoin’s future direction.
