Bitcoin’s correlation to equities remained in focus ahead of a fresh Wall Street open and key information regarding interest rates from the United States Federal Reserve.
The Fed’s Federal Open Market Committee (FOMC) is set to meet Wednesday, and any news regarding interest rates could have instant repercussions for both traditional and crypto markets.
“Tomorrow’s FED FOMC meeting could mean that we will see lots of volatility this week,” Cointelegraph contributor Michaël van de Poppe forecasts.
Rate hikes are planned to be the follow-on from the Fed’s asset purchase tapering, with Bitcoin sentiment taking a hit in advance as the end of “easy” liquidity nears.
Asset purchases should conclude by March, however, and the Fed has said that the rate hikes should not come before then.
“Price reversion in cryptos is likely to spread in 2022, after the assets were a poster child of speculative inflationary excess in 2021, but Bitcoin stands to come out ahead,” Mike McGlone, chief commodity strategist at Bloomberg Intelligence, summarized in a hopeful outlook for BTC.
“Correlations are heading toward 1-to-1.”
Earlier this month, McGlone said that Bitcoin could rebound stronger than stocks once they see a long-overdue correction of up to 20%. Now, he added that altcoins would likely fail to put in as solid a comeback.
Major altcoins wipe out earlier fall
On the topic of altcoins, these nonetheless put in a solid performance on the day, with Ether (ETH) matching Bitcoin’s advance.
ETH/USD was up 7.3% at the time of writing, trading at $2,420, having previously hit lows of $2,160 — its worst since mid-July.
Something of a V-shape recovery was also noticeable on other large-cap altcoins, including Binance Coin (BNB) and Solana (SOL).
“The good part is that we’re getting closer and closer to the next impulse rally on altcoins as most of them have been retracing fully,” van de Poppe argued before the rally.
Bitcoin
Bitcoin holds onto 10% gains ahead of crucial Fed rate hike comments
Bulls lift the market higher on the back of a stocks resurgence, but the specter of the Fed is on the horizon.
By
ioBanker
Bitcoin (BTC) held onto fresh upside on Tuesday after a resurgent stock market took the largest cryptocurrency above $37,500.
Fed may spark fresh volatility
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD trading above $36,000 on Tuesday, with maximum 24-hour gains totaling 14% versus Monday’s floor.
Bitcoin’s correlation to equities remained in focus ahead of a fresh Wall Street open and key information regarding interest rates from the United States Federal Reserve.
The Fed’s Federal Open Market Committee (FOMC) is set to meet Wednesday, and any news regarding interest rates could have instant repercussions for both traditional and crypto markets.
“Tomorrow’s FED FOMC meeting could mean that we will see lots of volatility this week,” Cointelegraph contributor Michaël van de Poppe forecasts.
Rate hikes are planned to be the follow-on from the Fed’s asset purchase tapering, with Bitcoin sentiment taking a hit in advance as the end of “easy” liquidity nears.
Asset purchases should conclude by March, however, and the Fed has said that the rate hikes should not come before then.
“Price reversion in cryptos is likely to spread in 2022, after the assets were a poster child of speculative inflationary excess in 2021, but Bitcoin stands to come out ahead,” Mike McGlone, chief commodity strategist at Bloomberg Intelligence, summarized in a hopeful outlook for BTC.
Earlier this month, McGlone said that Bitcoin could rebound stronger than stocks once they see a long-overdue correction of up to 20%. Now, he added that altcoins would likely fail to put in as solid a comeback.
Major altcoins wipe out earlier fall
On the topic of altcoins, these nonetheless put in a solid performance on the day, with Ether (ETH) matching Bitcoin’s advance.
Related: ‘Stop panic selling’ — Bitcoin whales bag spare BTC as exchange balances fall
ETH/USD was up 7.3% at the time of writing, trading at $2,420, having previously hit lows of $2,160 — its worst since mid-July.
Something of a V-shape recovery was also noticeable on other large-cap altcoins, including Binance Coin (BNB) and Solana (SOL).
“The good part is that we’re getting closer and closer to the next impulse rally on altcoins as most of them have been retracing fully,” van de Poppe argued before the rally.
More in Bitcoin
Bitcoin
Don’t be naive — BlackRock’s ETF won’t be bullish for Bitcoin
Are regulators trying to disarm crypto-native companies in order to pave the way for Blackrock to...
Bitcoin
US SEC deems spot Bitcoin ETFs filings as inadequate: Report
In the eyes of the SEC, the recent filings from BlackRock, ARK Invest, Fidelity and other...
Bitcoin
Bitcoin ‘overreacting’ as SEC returns ETF filings, BTC price dives 6%
Bitcoin ETF applications need refiling, the SEC says, but as BTC price dips to $29,500, markets...
Bitcoin
Will BlackRock’s ETF slingshot Bitcoin’s price skyward?
Have the world’s largest financial firms finally “seen the light” with Bitcoin? Will demand outstrip supply,...
Bitcoin
Why approving a Bitcoin ETF might unleash $18 billion in sell-pressure
Grayscale GBTC Trust conversion to an ETF will unlock a potential sale of up to $18...
Trending
Bitcoin
SEC Sues Kik for Conducting Allegedly Unregistered $100 Million ICO in 2017
Altcoins
Head of Facebook’s Libra Distances it from BTC: we’ll Share Information with Authorities
Altcoins
HashCash Consultants to Launch ‘Corona Fund Index Cryptocurrency’
Bitcoin
Overview of Software Wallets, the Easy Way to Store Crypto
Bitcoin
Is Blockchain Necessary? An Unbiased Perspective