Is the Crypto Market Bound to Rebound Before Today’s FOMC Statement?

Bitcoin (BTC) is currently in the process of establishing a bottom for its correction after experiencing a 15 percent drop in the last five days. The flagship cryptocurrency has seen a 2 percent increase in the past 24 hours, bringing its price to around $63k during the mid-London session on Wednesday. The intense volatility that led to over $550 million in crypto liquidation has started to slow down as more traders come to terms with the latest high-impact news.

In addition, institutional investors, such as MicroStrategy and BlackRock, have continued their Bitcoin acquisition programs in preparation for the upcoming halving event and the potential parabolic rally in the crypto market.

Looking at the macroeconomic outlook for cryptocurrencies, the Bank of Japan recently ended its deflationary period that began in 2007 by raising its interest rates to 0.1 percent. As a result, the Japanese yen has strengthened against the U.S. dollar, reaching above 150 ahead of the Federal Open Market Committee (FOMC) statement.

The Federal Reserve is expected to maintain its benchmark interest rate at 5.50 percent as it closely monitors inflation data. However, recent Consumer Price Index (CPI) data suggests that U.S. inflation has not yet reached the desired 2 percent, which may delay any expected interest rate cuts until at least June.

Cryptocurrency traders who sought refuge in stablecoins to protect their liquidity from forced liquidations are anticipated to re-enter the market following the FOMC statements. With the Bitcoin halving just 31 days away, the previous bullish sentiment is likely to continue in the coming days, driven by increased demand from institutional investors.

However, Bitcoin’s price may encounter significant resistance around the $74k mark and potentially consolidate before continuing its rally. This consolidation period could provide an opportunity for the altcoin industry to rally freely.

Tags: Altcoins, Price Analysis