Crypto Market News: In the lead up to the Federal Open Market Committee (FOMC) meeting between May 2-3, 2023, the S&P 500 Index ended the week on a high note with close to 1% jump over 5 days. The U.S. Federal Reserve’s meeting will be followed by jobless claims data and unemployment rate between May 4-5, 2023. While the market expects a 25 bps hike for the last time in a series of target rate hikes, any signs of dovish outlook going into June 2023 Fed meeting could keep the markets buoyed. However, there could be a bear trap event around the Fed rate decision, as the new target rate is likely to be 5-5.25% as against the central bank’s target of keeping inflation down to 2%.
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Also, traders expect that cooling inflation and stability in the job market could trigger a Fed rate hike pause when the central bank meets again on June 14, 2023, for the FOMC meeting. If the rate hike pause takes effect, the crypto market could potentially take a bullish position in anticipation of what could be a Fed pivot, which means rate cuts in further meetings.
Bitcoin Bullish In Next 45 Days?
As the market expects a rate hike pause in the June 14 meeting, any indication of a dovish stance from Fed Chair Jerome Powell in the post FOMC press conference could be key for setting the market mood for the next 45 days. However, further fluctuations in the Consumer Price Index (CPI) and jobs data could dent the prospects of a rate hike pause in near future. Earlier, CoinGape reported that Bitcoin price could see resistance at $31000 level, as against the current price range of $29,243.
As per the CME FedWatch Tool, as many as 84% of the respondents are expecting that the US Fed takes a 25 bps hike decision in the May 3 meeting. Hence, a rate hike on expected lines may likely trigger a Bitcoin price drop, before taking an upward path, depending on Powell’s comments. Already, Goldman Sachs economists said they don’t expect the U.S. Federal Reserve to raise interest rates in June 2023. Hence, the next 45 days could overall be bullish for Bitcoin price, even as many predict BTC to go as high as $100,000.
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