Bitcoin, Ethereum and altcoins hold intraday gains after Fed hikes interest rates by 0.75%

After the Federal Reserve’s third consecutive 75-basis point (bps), interest rate increase on Sept. 21, Bitcoin (BTC), retreated and reversed intraday gains

The news was sold by traders

BTC dropped 6.5% from $19,950 intraday high, and reached $18,660 just minutes after the Federal Open Market Committee statement. The decline was mirrored by a similar abrupt correction in the U.S stock market. The benchmark S&P 500 fell 0.5% minutes following the Fed update.

Daily chart of BTC/USD price. Source: TradingView

The yield on the 10-year U.S. Treasury notes rose to 3.6% following the Fed’s announcement, compared with 3.56% just five minutes earlier. The yield on the 2-year Treasury Note rose from 3.98% up to 4% during the same period.

The U.S. Dollar index (DXY), which measures strength of the greenback against a basket top foreign currencies, jumped to 111.57 on the first day in 20 years.

A Fed “dot plot” was also released. This updated version complied to the Fed’s individual interest rate projections for 2025. These forecasts indicated additional rate increases in the future. The 2022 target was 4.4%, while the 2023 target was 4.6%.

Officials at the central bank predicted that the policy interest rate would reach a peak of 4.6% in 2023. It would then fall to 3.9% by 2024 and drop to 2.9% by 2025.

All metrics point to greater pain for Bitcoin

After the Fed update, Bitcoin’s rise and fall reflected investors growing desire for cash and cash-based assets. The central bank’s dots plot suggested that investor sentiment would not change until 2023.

Related: Bitcoin ‘nuke’ warning as Fed rate hike decisionlooms — Dollar Index hits 20-year high

The Fed’s hawkish stance, and attempts to lower inflation from 8.3% could cause Bitcoin to continue to fall. Many analysts pointed out that Bitcoin’s current technical support range of $18,000-20,000. The Fed could increase rates by 75 basis points before the end of the year.

I really don’t know how much longer this $BTC support can hold pic.twitter.com/YAdkkB9Zww
— CRG (@MacroCRG September 20, 2022

The technical outlook for Bitcoin was similarly bearish. Notably, the cryptocurrency has been forming a bearish reversal pattern dubbed the “head-and-shoulders,” whose profit target sits around $14,000, as illustrated below.

Daily chart of BTC/USD price. Source: TradingView

Bitcoin could see $22,500 as an interim upside target if it recovers from $18,800 head-and shoulder support.

com. You should do your research before making any investment or trading decision.
https://cointelegraph.com/news/bitcoin-ethereum-and-altcoins-hold-intraday-gains-after-fed-hikes-interest-rates-by-0-75

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Donna Burk– Business News My Name is Donna Burk and I am also the main source from the ‘Dailynewssheet.com’ of all the exclusive and most delicate visualization of the activities in the business sector. My first step towards this journey was taken in the very early years of my life. I started with an independent financial consultant. However, I only had almost 4 years of skills and experience in this market. I have always been a free personality and like to fly one place to another, to explore more and more. Moreover, this passion and craze of traveling gave me a chance to report a section for best news associations. Last but not least, I am presently working full-time as an editor.

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