© Reuters
Investing.com – Thursday was a busy day for the , with the cryptocurrency managing to climb to the highest since June 2022 at $25,232. However, the rise did not last, and the is back below $24,000 on Friday morning.
Recall that the key resistance of $25ka attracted sellers, and sent the cryptocurrency lower, before interventions by members of the Fed, cast a chill on the markets, including that of cryptocurrencies.
Hawkish Fed Statements Penalize Bitcoin
Loretta Mester, who heads the Cleveland Fed, said in particular that “the Fed will have to raise rates above 5% and stay there for a while”. She also judged that “the demand side of the economy is not cooling as expected”. Mester also concretely warned, in reference to the recent higher-than-expected CPI, that “more upside inflation surprises could make Fed policy more aggressive.”
Meanwhile, James Bullard said he expects a final rate of 5.25-5.50%, slightly above current market expectations, and expressed skepticism that the labor market will slow as expected. More importantly, he pointed out that he argued for a 50 basis point rate hike during the previous Fed meeting, and suggested that this option remain on the table, stating that “nothing should be ruled out for the next meeting” of the FOMC.
Following these resolute statements, the probability of seeing the Fed raise its rates by 50 basis points for the next meeting on March 23 jumped to 18.1%, against only 6.3% the day before and 9.2% the previous week.
In this context, the fall of Bitcoin, initially initiated on technical factors, largely accelerated, and pushed the cryptocurrency to a low of $23,362 on Thursday evening.
From a graphical point of view, it should be noted that the correction of Bitcoin since Thursday evening does not yet call into question the bullish bias visible on the daily chart. As for important thresholds, the $23,000/$23,300 area is immediate support, before $22,000, then the $21,400 area. On the upside, $24,000 is immediate resistance, ahead of $25,000, then yesterday’s highs at $25,232.