An expert analyst said that because the market has not yet priced in the FED’s possible interest rate cut postponement. cryptocurrency He warns that the market may head towards a downward correction in the short term.
Jag Kooner, Head of Derivatives at Bitfinex, argues that the market is currently pricing in the Fed to be more dovish than Chairman Powell’s comments implied. Powell’s latest statements indicate that the delay in market pricing, among other cryptocurrencies and financial markets, Bitcoin It also warns that it could trigger a downward correction.
“If market expectations for a rate cut remain high and the next FOMC meeting results in a fixed interest rate, the cryptocurrency market may decline in the near term,” Kooner said. He added that Powell’s signal that the rate cut would be postponed “potentially contributed to the risk-off sentiment in the market.”
According to BIT Mining Chief Economist Youwei Yang, there are other uncertainties in current market conditions that are contributing to this risk-off sentiment.
“The delay in the rate cut, the reduced likelihood of a soft landing, and the dotcom bubble-type patterns seen in AI stocks have concerns that markets are currently turning into a risk-off sentiment, which could lead to a broad sell-off triggered by any new events such as CPI data,” Yang said.
Vertex Protocol Co-Founder Darius Tabai echoed these views, stating that there is still no clarity on when the interest rate cuts will come into effect. “For now, it doesn’t make sense to see big moves in either direction given inflation and interest levels, as central bankers tend to move slowly in their analysis,” Tabai said.
*This is not investment advice.
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