Bitcoin (BTC) hit $ 40,000 on March 17 after an expected rise in the Federal Reserve’s key policy rate hit hard.
Hourly candlestick chart BTC / USD (bit stamp). Source: Trading View
The Federal Reserve highlights war with Ukraine in comments on inflation
Data from Cointelegraph Markets Pro and TradingView showed that BTC / USD rose to local highs of $ 41,500 after the Federal Reserve announced a 25 basis point rise in interest rates to 0.5%, the first such move since 2018.
The Federal Open Market Committee (FOMC) voted almost unanimously for the increase, warning in an accompanying statement of continued “upward pressure on inflation”, especially due to the war in Ukraine.
“The Russian invasion of Ukraine is causing enormous human and economic difficulties,” she said.
“The implications for the US economy are very uncertain, but in the short term the invasion and related developments are likely to increase the upward pressure on inflation and curb economic activity.”
The FOMC continued that there will be more increases in the future, and the Fed will begin to reduce its holdings in an attempt to reduce the record balance.
“The Committee’s assessments will take into account a wide range of information, including public health indicators, labor market conditions, inflationary pressures and inflation expectations, as well as financial and international developments,” the statement said.
After the first bullish reaction, Bitcoin consolidated an overnight rally, still holding around $ 41,000 at the time of writing.
Cointelegraph contributor Mikael van de Poppe now needed just under $ 40,000 to move in to support.
“Good reaction from the markets here when the price broke the $ 39.6K mark,” he told his Twitter followers the same day.
“The next thing will be the question of whether we can raise the ceiling to $ 42,000. This will open the door to the $ 46,000 barrier. It is very important to keep on; $ 39.6K area for bitcoin. ”
These levels are already well established as steps on a ladder spanning the Bitcoin 2022 trading range between $ 33,000 and $ 46,000, and this week an analyst claimed that just a move outside the upper or lower limit would be significant.
Asian markets continue to grow on the promise of China
Optimism also remained in traditional markets as China boosted Asian equities with promises of favorable political change.
See also: The President of Ukraine signed a law establishing a regulatory framework for cryptocurrency
“The Hang Sang Tech index jumped 7.8 percent, prolonging the rise after Beijing succumbed to MKTS,” concluded commentator Holger Schipitz.
Previously, China did not care if Western investors could invest there. But it needs capital and does not need an accident. Therefore, it was announced on Wednesday that China will be market-friendly. ”
Gold also looked promising, partially restoring the decline from previous highs above $ 2000.