The price of Bitcoin has dropped to a key support level after both the S&P 500 as well as the DOW pulled back. This comes as a result of the Federal Reserve moving forward with its plan for a couple of hikes in the interest rate in the next couple of years. The price of BTC got its losses extended after Jerome Powell, the chair of the Federal Reserve, announced that the Reserves would be moving its timeline forward by scheduling a couple of interest rate hikes.
The price of Bitcoin had already witnessed a couple of weaknesses in the early hours of trading after it lost its valuation at a level of $40,000- which marked an intra-day low at around $38,300. The S&P 500 coupled with the Dow also managed to pull their losses back at 0.77% and 0.54% respectively. This decision regarding interest rates comes in as most economists have been concerned with the rising rate of inflation in the country.
Jerome Powell further stated that the Federal Reserve had to raise the expectation of inflation from a sum of 2.4% to 3.4%. Although the Chair of the Federal Reserve did describe the inflation spike moving currently as transitory- most of the consumer prices seem to be at a 13 year high. No wonder most Bitcoin traders as well as other analysts have been worrying about how the rising inflation rate would negatively impact the economic recovery post-covid.
Can Bitcoin price maintain its current range?
Bitcoin did complete its bullish inverse head on the 15th of June but still fell short of its designated target of $45,500 after it touched resistance base at $41,350. While the cryptocurrency price managed to fall below the price range of $40,000 while failing to flip its support level, several analysts have been checking in on the current price action as nothing more than short-round trading.
Now, with the daily close just three hours away, most of the Bitcoin traders will be looking towards the cryptocurrency to hold its moving average price at around $37,000.