Major coins rallied after the US Federal Reserve meeting ended on Wednesday. The global cryptocurrency market capitalization is up 8% to $1.05 trillion at press time.
Price development of the most important coins
|coin||24 hours||7 days||Price|
|Bitcoin (CRYPTO: BTC)||7.9%||-2.2%||$22,860.56|
|Ethereum (CRYPTO: ETH)||13.7%||6.4%||$1,627.89|
|Dogecoin (CRYPTO:DOGE)||7.3%||-4.7%||$0.07 USD|
Top 24-Hour Gainers (data via CoinMarketCap)
|Cryptocurrency||24 hour % change (+/-)||Price|
|Lido DAO (I DO)||+35.2%||$1.92|
|Ethereum Classic (ETC)||+31.5%||$32.99|
Bitcoin and Ethereum are up thanks to the Fed
Bitcoin and Ethereum rose nearly 8% and 14% the day after the Fed announced a 75 basis point interest rate hike. At the end of Wednesday’s meeting of the Federal Open Market Committee (FOMC), the Fed chairman made the statement Jerome Powell dovish on future rate hikes, CNBC reported.
“As the policy stance continues to tighten, it will likely be appropriate to slow the pace of increases while we assess how our cumulative policy adjustments affect the economy and inflation,” CNBC said.
Asked whether the US economy was in recession, Powell said that while growth was negative in the first quarter, it is expected to be slightly positive in the second quarter.
Interest rate increases will slow down sooner or later
Edward Moyaa senior market analyst at OANDA, noted that Powell did not rule out another 75 basis point rate hike at the next Fed meeting, but said it would be appropriate to slow rate hikes at some point.
“A clear green light to buy risky assets will not come until we see signs of inflation slowing. Inflation risks will remain high as energy shortages are likely, supply chain issues will not abate amid a weakened global outlook, and pandemic concerns remain worrisome , Moya said.
Moya said about cryptocurrencies
“The FOMC decision provided optimism that the end of tightening is in sight, and it sparked a nice rally for risky assets that helped push crypto higher.”
“Given the outperformance of tech stocks, it should come as no surprise that cryptocurrencies have stabilized. Crypto trading could develop here as a peak in returns appears to be on the horizon.”
Cryptocurrencies continue to follow risky assets like stocks. On Wednesday, the S&P 500 and Nasdaq rose 2.6% and 4.1%, respectively, following the announcement of interest rate hikes.
End of correlation unpredictable
Nick HealeHead of Management Advisory at UK digital asset trading firm GlobalBlocksaid that Bitcoin does not necessarily track risky assets like tech stocks, adding that it is difficult to predict when the correlation will end.
Heale said: “It will be a difficult decision to predict when that turnaround will happen [Rückgang der BTC-Preise] will start, maybe late 2022 to early 2023 or earlier? The complex mix of economic factors will make market timing of a reversal or even decoupling from the broader performance of risky assets a difficult decision for investors!”
Michael van de Poppe posted the three ideal ingredients for a “summer help rally” on Twitter. The cryptocurrency trader sees Ethereum at $2,400 and Bitcoin between $28,000 and $30,000.
The ideal ingredients for a summer recovery rally are here:
� Powell is becoming dovish in politics and more data dependent.
� The one $ETH Merger is expected in September.
� Strong impacts at 3AC, Celsius and more are already priced in.
— Michaël van de Poppe (@CryptoMichNL) 27 July 2022
Meanwhile, on-chain data from Glassnode shows that Bitcoin has exceeded the realized price – a reference to the value of all Bitcoins at the price they were purchased, divided by the number of BTC in circulation.
#Bitcoin has just returned above the realized price, which is currently $21,800.
This corresponds to the average price of $BTC-Coin supply estimated at the time of the last movement on the chain.
Live chart: https://t.co/US6j4k5h4C pic.twitter.com/0LbXAdtNTz
— glassnode (@glassnode) 27 July 2022
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