As the crypto space eagerly awaits the outcome of the FOMC meeting and its impact on cryptocurrencies, it looks like Bitcoin bulls are back on their way. Bitcoin price has reclaimed its $23,000 zone and is heading strongly towards its next bull run.
At the time of writing, Bitcoin is selling at $23,097 after rising 1% in the last 24 hours.
This is not the first, since the start of 2023, Bitcoin has broken through many bearish pulls. For now, all eyes are on the US Federal Reserve’s interest rate decision after the FOMC meeting scheduled for February 1 at 19:00 GMT. After the FOMC meeting is over, 30 minutes later the Federal Reserve will reveal its decision in terms of raising interest rates after 30 minutes of the FOMC meeting.
The Fed’s Decision to Shape Bitcoin’s Future Price Action
Therefore, the crypto market today is expected to show high volatility, especially the world’s first cryptocurrency, Bitcoin. The Federal Reserve’s decision to raise interest rates will be based on two factors: the minimum unemployment rate and the controlled inflation rate. It all depends on these two numbers that will decide whether the Fed will take a hawkish or dovish approach. Here, the hawkish stance refers to a decision that is geared towards controlling inflation and the dovish stance refers to the decision that leans more towards economic growth rather than inflation control.
However, what should be noted is that, so far, the Fed has taken a hawkish stance where it has even raised interest rates between 4.25% and 4.50%. Nevertheless, today interest rates are expected to rise by 0.25% or 25 basis points. This should happen at 99.4% while the 50 basis point interest rate hike is in probability of 0.6% as claimed by CME’s FedWatch tool.
Now, even though Bitcoin has claimed a level of $23,000, the King coin is mostly expected to face rejection at $23,500 and drop towards $22,300. If the bulls fail to take control here, BTC will drop further to $21,232. However, everything depends on the FOMC meeting and the Fed’s decision.