the Bitcoin approached the psychological mark of $40,000 on Wednesday evening; the global crypto market cap jumped 5.5% to $1.8 trillion.
|Token||at 24 hours||at 7 days||Price|
|Bitcoin (CRYPTO:BTC)||+ 4.8%||+ 1.1%||$39,611.43|
|Ethereum (CRYPTO:ETH)||+5.6%||+ 1.9%||$2,940.83|
|Dogecoin (CRYPTO:DOGE)||+ 4.2%||– 4.5%||$0.135|
|Token||% change at 24 hours (+/-)||Price|
|waves (CRYPTO:WAVES)||+ 30.1%||$15.64|
|tron (CRYPTO:TRX)||+ 20.1%||$0.088|
Why this matters
The Federal Reserve voted unanimously to increase its target rates by 0.5% on Wednesday. This is the first increase of such magnitude since the beginning of the millennium. The US central bank will also start reducing the size of its balance sheet from June 1.
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“Inflation remains elevated, reflecting pandemic-related supply and demand imbalances, as well as rising energy prices and pricing pressures,” she said in a statement. .
The press conference held by the Chairman of the Fed, Jerome Powellhelped to reassure investors, informing that a future rate hike of 75 basis points was not “currently” envisaged, reports CNBC.
The dollar hit a week-long low after Powell’s comments, with the dollar index (DXY), which tracks the strength of the USD against a basket of six other currencies, falling as low as 102 ,48, informed Reuters.
The improved sentiment surrounding crypto was evident on Alternative.me’s Fear and Greed Index, which showed ‘fear’ at the time of this article’s publication, versus ‘extreme fear’ the day before. .
OANDA’s Senior Market Analyst, Edward Moyasaid Powell believed he could rein in inflation without resorting to drastic measures.
“US stocks surged after Fed Chairman Powell signaled he could slow inflation without triggering a recession. It looks like risky assets may regain ground now that Wall Street has fully priced in the rest of the year rate hikes,” Moya wrote, in a note seen by Benzinga.
The cryptocurrency trader Michael van de Poppe tweeted that Wednesday’s events were “the textbook example” of the “sell the rumour, buy the news” approach.
Indeed, “fear can cause prices to plunge, then the actual event occurs and the reaction is contrary to expectations”.
Classic example of:
Sell the rumour, buy the news.
Prices overreacting to the downside out of fear, and then the actual event takes place and the reaction says the opposite.
— Michael van de Poppe (@CryptoMichNL) May 4, 2022
Justin Bennettanother cryptocurrency investor, warned that BTC’s rally could be misleading.
So $BTC has broken out of this falling wedge on a 4-hour closing basis.
But initial breakouts can be deceiving, especially hours before a volatility-inducing #FOMC.
— Justin Bennett (@JustinBennettFX) May 4, 2022
The Chartist Ali Martinez argues that the number of new addresses created on the Bitcoin network, as the price of the token fell from $43,000 to $37,500, recently reached 422,000.
“This suggests an increase in user adoption of the coin, which may lead to a bullish move.”
It suggests an increase in user adoption, which can result in a bullish breakout. pic.twitter.com/NajpbI2GVw
— Ali Martinez (@ali_charts) May 4, 2022
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Bitcoin, Ethereum and Dogecoin in positive after rate hike
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