A 5.7% slide in the price of Bitcoin ($BTC) was caused by remarks from Fed Chair Powell at the FOMC meeting on Wednesday. The Chairman said that there may only be two rate cuts for 2025. This news plunged all markets into the red, and Bitcoin sank to just above $100,000.
Powell speech sends markets crashing
Wednesday’s FOMC meeting ended with the customary speech from Federal Reserve Chairman Jerome Powell. it was announced that there would be a 25 basis points rate cut, which the market was ready and prepared for. However, as his speech continued, he let it be known that there would likely only be two more adjustments to come for the whole of 2025.
On top of this, the newly updated dot plot chart which has the future rate expectations of all the individual Fed members, was actually pointing to a rate rise of 50 basis points.
As the news sunk in, the U.S. stock market plunged heavily, while the dollar rocketed to the upside. Bitcoin fell around $6,000 on the day, and the altcoins were generally smashed across the board.
The Federal Reserve generally has the most incredible juggling act to do in some of these FOMC meetings. While it sees the absolute necessity of cutting, given the dire state of the jobs market, it does not want to give rein to inflation once again. Therefore, announcing a rate cut, while at the same time sounding incredibly hawkish in the speech afterwards, had the desired effect of dampening down any market enthusiasm.
$BTC price touches bottom of ascending channel
Source: TradingView
For the Bitcoin price it was probably just business as usual. While the drop was very sudden and precipitous, the bears only really succeeded in bringing the price down to the bottom of the ascending channel, within which the price is currently traversing.
The price did fall below a trendline that $BTC had been respecting since 4 November, and it now remains to be seen whether the bulls can regain the upper hand and push the price back above this trendline. The price is right at the trendline now, and therefore we will either see a confirmation of the breakdown and rejection, or the price will get above and head back to the top of the ascending channel.
Weekly chart nothing out of the ordinary for $BTC
Source: TradingView
On the weekly chart view there doesn’t appear to be anything out of the ordinary going on with the $BTC price. Last week’s hammer candle, plus all the last few candle wicks to the downside, augur more upside movement to come.
Looking at the bottom of the chart at the RSI, it can be seen that the indicator line has started to turn back down. That said, the 70.00 level could act as strong support, as it has done several times so far.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
