Bitcoin lost 8% to explore the $38K level, erasing most of its recent gains. The latest downward actions emerged after US jobs market data showed strength. Such metrics support Fed Reserve’s rate hikes narrative this month.
For now, traders expect further downside, eyeing the next support floor at $35,000. Breaching this barrier will see Bitcoin hitting levels never seen over the past two weeks when the Russian-Ukraine conflict triggered risk-off sentiment. Though the alternative token gained from 1-month lows to levels of $44,000, the gains stalls amid pullback by whale account activity.
Meanwhile, $44,000 was Bitcoin’s last ceiling in February. The digital coin stays 18% down this year. Cryptocurrency investor @StevenAitchison commented on BTC’s current slump, stating Bitcoin dipped into $35K – $39K territory. Moreover, the market lacks positive news to trigger a swift rally. That way, the investor believes Bitcoin will dip towards the support line at $35K.
Fed Hikes Trigger Bearish Outlook for BTC
Though Bitcoin was on mild downswings within the last few days, the crypto experiences accelerated slides after massive US jobs data. Employment surged at the highest pace in seven months over the past month (February). That’s according to reports from Yahoo Finance. Meanwhile, the news tied to the latest comments from Fed Chairman Jerome Powell that the job space was flourishing and rate hikes would follow in March.
Interest rates hike will translate to reduced market liquidity. That would limit the cash individuals can invest in Bitcoin.
Remember, Fed considers employment and inflation factors when adjusting rates. Rate hikes appear possible in Fed’s 15 March and 16 March meetings as US consumer prices hover at a 40-year peak. Hawkish comments by Powel dismissed the latest speculations that the Russia-Ukraine war would make Feral Reserve delay the hiking plans.
Broad financial markets plummet following the data, as Fed hikes prospect weighed on uncertainty from Russia-Ukraine war. Concerns about Russia capturing the largest nuclear plant in Europe ruined the sentiment.
Bitcoin dropped on Friday as US equities recorded lows. That came after BTC decoupled from the stock industry for almost one week. BTC’s fear & greed index plummeted into ‘extreme’ fear. That’s after being neutral for a week.
