Bitcoin price hits $20.8K as volatility ensues over Fed 75-point rate hike
Bitcoin (BTC) saw instant volatility on Nov. 2 as the United States Federal Reserve enacted a fourth consecutive 0.75% interest rate hike.
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD initially dropping to $20,200 before momentarily rebounding to $20,800.
The Fed confirmed the 0.75% hike, which marks its most intensive hiking schedule in forty years, in a statement.
“The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. In support of these goals, the Committee decided to raise the target range for the federal funds rate to 3-3/4 to 4 percent,” it stated.
Analysts had long predicted increased volatility around the rate decision. At the time of writing, Fed Chair Jerome Powell was still to deliver comments on the move, something markets would be keenly eyeing for trajectory cues.
“Beware, volatility will remain high during this event, fake-outs happen before the real move takes place!” Michaël van de Poppe, founder of trading firm Eight, told Twitter followers.
The Fed’s decision had been nonetheless widely expected, as per CME Group's FedWatch Tool, with Cointelegraph reporting on a theory that sticking to the script would still offer crypto a shot at further upside.
Should Powell hint at possible slower increases or a pivot in policy, the situation could however turn dramatically.
Related: New Bitcoin Yardstick metric says $20K BTC now ‘extraordinarily cheap’
“The market rallying ~13% off the lows was this expected 75 bps. It’s all about the presser now,” popular account CryptoISO summarized.
The statement confirmed that Fed officials had voted unanimously for 0.75%.
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