The Federal Open Market Committee (FOMC) is set to make its latest interest rate decision, and the crypto market is bracing for impact. With the latest Consumer Price Index (CPI) data showing signs favorable for a rate cut, traders are closely watching whether the Federal Reserve (Fed) will pivot or maintain its stance. Here’s how different scenarios could impact Bitcoin (BTC) and altcoins.
Curious about how US Federal Reserve rates impact crypto? This article provides a comprehensive analysis- How the US Fed Rates Impact Crypto Market
Bitcoin dominance ($BTC.D) is currently at the end of a rising wedge pattern. Historically, such patterns indicate a potential breakdown, which could be huge for altcoins.
If BTC dominance falls, capital could start flowing into altcoins, igniting an altseason. However, if dominance remains strong, it may indicate continued BTC strength while altcoins lag. The FOMC decision could be the catalyst that determines the next big move.
Polymarket, a leading on-chain prediction market, shows that 99% of traders believe the Fed will not cut rates in March.
But here’s the catch – the market is often wrong. In previous cycles, when the consensus leans too heavily in one direction, the Fed has surprised traders. If Powell hints at cuts later in the year, we could see a major market reaction.
With BTC dominance at a critical level and expectations heavily tilted towards no rate cut, the FOMC meeting could be a game-changer. If the Fed holds rates but signals future cuts, expect a bullish push for crypto. However, a hawkish stance could lead to short-term turbulence.
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