Bitcoin (BTC) is down 8%, deepening to $38,000, erasing most of its recent gains. Data pointing to growth in the US labor market is fueling current sales, strengthening the situation for the Fed’s rate hike this month. Current market data and price forecasts cryptocoin.com We have compiled for its readers…
Fed’s rate hikes reflect negatively on Bitcoin
Bitcoin’s losses have increased after strong US jobs statistics, although they have been on a slight decline for the previous few days. Employment rose at the fastest rate in seven months in February, according to reports. The result also corresponds to Fed Chairman Jerome Powell’s last words that the labor market is warming and that the Fed will likely raise interest rates by at least 25 basis points in March.
The Fed bases its rate adjustments on two key factors: inflation and employment. While consumer prices in the US are at their highest level in 40 years, the Fed is expected to raise interest rates at its meeting on March 15 and 16. Powell’s hawk comments also debunked previous rumors that the Fed’s hike plans will be halted due to the Russia-Ukraine crisis. Broader financial markets paled following the release of the data, as the increased potential of the Fed added to the uncertainty created by the Russia-Ukraine crisis. Concerns about Russia’s seizure of Europe’s largest nuclear power plant in Ukraine also shook public opinion.
Despite nearly a week’s divergence from the stock market, Bitcoin caught up with US stocks on Friday. After almost a week of neutrality, the Bitcoin fear and greed index has turned to extreme fear.
Bitcoin going to $35,000?
Traders are now watching $35,000 as the next level of support. The loss of supports threatens Bitcoin two weeks ago where growing concerns of the Russian-Ukrainian conflict led to a risk-averse attitude. BTC then rose from a one-month low to $44,000, while gains were halted due to a slowdown in trading huge whale accounts. In February, Bitcoin reached $44,000 for the last time and has lost more than 15% in the new year so far. Twitter’s Steven Aitchison thinks the $35,000 support zone is as inevitable as it is decisive:
We’re back in the $35,000-$39,000 range and there isn’t much of a way for important positive news to ignite a rally. As a result, we may need to move back to the $35,000 support line.
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