BTC Erases Dangerous Bearish Sentiment After FED Meeting

BTC erases dangerous bearish sentiment that was formed over the past week and the coin underwent a sell-off but after the recent FED meeting, it stabilized so let’s see more in our recent Bitcoin news.

The cryptocurrency fought off the fears of further downsides correction after the FED policy update and now the US central bank announced that it will keep the near-zero interest rates steady.
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The policy update from the Federal Reserve results in  BTC erases dangerous bearish bias and about 18 of the central bank governors said that they want to keep the interest rates near zero in 2023. In the meantime, the other 7 anticipated that they will hike the lending rates in 2022 or 2023 from five in December.

Since April 2020, the FED purchased $120 billion worth of government debts and mortgage-backed securities per month and their policy resulted in negative bond yields. On the other hand, the benchmark rates between 0 and 0.25 made the US dollar borrowing cheaper and pushed it lower by 12% against a basket of top foreign currencies. For the investors, holding cash and bonds promises low returns which forced them to take risks in alternative markets like BTC whose value surged by 1500% from its mid-market crash of $3,858. Bitcoin’s appeal lies in the 21 million supply cap and makes it equivalent to gold almost and a safe haven asset as well.

The cryptocurrency benefits from a lower yielding bond market and depressive fiat currencies which explains why it was able to rebound after the FED declared its monetary policies. BTC increased from $53,000 to $58,925 while the cryptocurrency extended its jump during the Asia-Pacific session and touched $59,575 before turning lower on the profit-taking sentiment. The IOMAP indicator shows that the last level of resistance is located between $58,897 and $59,241 according to the data by IntoTheBlock.

More tailwinds for the bullish scenario are coming from Morgan Stanley and its announcement that it will offer clients access to three BTC funds. The move logged another milestone in the growing adoption for the mainstream financial houses which raised the hopes that the investors will allocate their funds into traditional portfolios.