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The expected occurred at Tuesday’s FOMC meeting, and the Federal Reserve announced for the third consecutive time that the rate would remain unchanged. This situation resulted in a 4.5% increase in the Bitcoin (BTC) price compared to yesterday, and as of the time of writing, it is trading at around $42,800. Following the decision, noticeable fluctuations were observed in the cryptocurrency market. The altcoin market also participated in this price movement!
Altcoin Market Rally
Earlier this week, Bitcoin faced some selling pressure and dropped to around $4,000, after which altcoins also followed and experienced a noticeable decline. However, following the positive Fed decision, the market sentiment improved, and altcoins continued to rise. Ethereum (ETH) saw a 3.75% increase to $2,258, while major altcoins by volume such as Solana (SOL), Avalanche (AVAX), and Cardano (ADA) also joined the price increase.
The latest announcement by the Federal Open Market Committee (FOMC) confirmed that the Federal Reserve had decided to maintain the current interest rate levels. The unexpected rapid decline throughout the year, following the battle against inflation, paved the way for revisions to the projections put forward by officials.
According to the consensus reached by most officials, as part of the effort to bring inflation to the 2% target, three interest rate cuts are anticipated for 2024. Federal Reserve board member Christopher Waller did not shy away from commenting on the possibility of starting interest rate cuts in the spring, contingent on the continuation of positive inflation performance.
Although three interest rate cuts were discussed, this is less than the five cuts previously predicted by many analysts on Wall Street.
Buying in a Downturn Market?
According to most cryptocurrency analysts, the crypto market is expected to continue its “Santa Claus rally,” a term for the recent price movement, towards Christmas and into 2024. Cryptocurrency analyst Michael van de Poppe shared his thoughts on the FOMC meeting, stating that it ended with a dovish stance and indicated possible future interest rate cuts.
Van de Poppe pointed out the sell-offs in Bitcoin before the FOMC event, suggesting a flight to safety sentiment, followed by a recovery. He expressed his positive thoughts on the continuation of the upward trend. Van de Poppe set a price target for Bitcoin of between $47,000 and $50,000 before a potential ETF approval.
