Bitcoin's early week recovery falters after Fed Chair Jerome Powell's comments suggest a cautious approach to rate cuts, pushing prices down to $95,000. The cryptocurrency's price action is closely tied to investor sentiment regarding the Fed's monetary policy, with cheaper capital traditionally boosting risk-on assets like Bitcoin. The upcoming January CPI report holds significant weight, as a higher-than-expected inflation figure could delay rate cuts and pressure Bitcoin downwards.
Early week recovery in Bitcoin stalled at $98,000 and subsequently plunged to $95,000 following a hawkish outlook on interest rate cuts from Federal Reserve chair Jerome Powell . During his semi-annual monetary report to the U.S. Congress on February 12th, Powell reinforced that the agency was not 'in a hurry to change its policy stance.' He stated, 'Our policy stance is now less restrictively than it had been, and the economy remains strong.
We do not need to be in a hurry to adjust our policy stance.' For context, lower interest rates signify cheaper capital, which generally fuels bullish sentiment for risk-on assets like Bitcoin and stocks. However, after a hawkish hold in last month's Federal Open Market Committee (FOMC) meeting, the slow Fed rate cut outlook and Trump's tariffs have exacerbated bearish sentiment. U.S. labor markets and inflation status ultimately determine the Fed's rate cut decisions. Consequently, markets will shift their focus to crucial inflation data, the January Consumer Price Index (CPI) report scheduled for release on February 12th. According to data tracked by Forex Factory, the forecasted target for monthly change for last month's CPI is 0.3%. If the actual CPI surpasses this figure, it could be perceived as bearish as it might prompt the Fed to maintain the interest rate unchanged for an extended period. Conversely, a lower CPI print could slightly bolster the market and the probability of a rate cut. It remains to be seen whether the CPI print will influence market pricing. Nevertheless, the aforementioned headline risk has subdued overall demand, as per the Coinbase Premium Index. This indicator tracks the appetite of U.S. investors for Bitcoin and exhibits a positive correlation with BTC price action. Following a surge in early February, the indicator has returned to a neutral level. Similarly, BTC retraced from $101,000 to $95,000 over the same period. Any further decline in the Coinbase Premium Index into negative territory could impede BTC's short-term recovery, despite the impending supply shock as the over-the-counter (OTC) balance contracts. In the meantime, the cryptocurrency's volatile market condition may persist, according to the Coinglass liquidation heatmap. Pockets of liquidity (bright levels) are evident on both sides of the price action.
BITCOIN FEDERAL RESERVE JEROME POWELL INTEREST RATE CUTS CPI INFLATION MARKET SENTIMENT OTC BALANCE LIQUIDITY
Canada Latest News, Canada Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Bitcoin Consolidates After FOMC, Tether Expands on Bitcoin Network, Kraken Resumes StakingBitcoin has been trading in a tight range after the Federal Open Market Committee (FOMC) meeting. The Fed maintained its interest rate, citing 'somewhat elevated' inflation. Meanwhile, Tether announced plans to mint USDT on Bitcoin's base layer and Lightning Network, utilizing the Taproot Assets protocol. Kraken also resumed crypto staking in the US after a two-year hiatus due to SEC regulations. Additionally, the news highlights the potential for BTC and ETH ETFs to list soon, with recent updates on S-1 filings signaling a near future launch.
Read more »
Bitcoin Price Could Explode to $249,000 by 2025, Says CryptoQuantNew data from CryptoQuant suggests Bitcoin's price could reach as high as $249,000 by 2025 under ideal conditions. The projections are based on Bitcoin's realized cap growth and market multipliers, with three potential scenarios outlined. The most optimistic scenario sees Bitcoin's market cap hitting nearly $5 trillion, driven by continued institutional adoption and strong capital inflows. Even the most conservative estimate places Bitcoin's price at $145,000 by 2025.
Read more »
Gold price to hit $3k this winter, Trump vs. Powell – ‘anything can happen’: Chris VermeulenThe Kitco News Team brings you the latest news, videos, analysis and opinions regarding Precious Metals, Crypto, Mining, World Markets and Global Economy.
Read more »
Japan's Bitcoin-Fueled Hotel Chain Sees Shares Soar Amid Trump's Crypto AgendaMetaplanet Inc., a Japanese hotel company, has seen its shares surge over 4,800% in the past year after shifting to a Bitcoin-first strategy. The company's success is attributed to the pro-crypto policies of U.S. President Donald Trump, which have fueled demand for Bitcoin in Japan. Metaplanet CEO Simon Gerovich aims to invest heavily in Bitcoin and rebrand its remaining hotel as 'The Bitcoin Hotel'.
Read more »
Poilievre Rallies Conservatives in Powell River, Promises Tax Cuts and Economic ReformConservative leader Pierre Poilievre addressed a large crowd in Powell River, British Columbia, outlining his party's platform focused on tax cuts, economic growth, and social policies aimed at alleviating the cost of living and addressing inequality.
Read more »
Powell, Clippers win in Lakers' first visit to Intuit DomeNorman Powell scored 22 points, James Harden added 21 points and 12 assists and the Los Angeles Clippers defeated LeBron James and the Los Angeles Lakers 116-102 on Sunday night in the Lakers' first visit to the new Intuit Dome.
Read more »