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FED Hikes Interest Rate
Bitcoin is currently trading below $19,000 and is losing momentum on the lower timeframes. The price struggled to break above the notable resistance at $19,600 and is dropping once again following the Fed announcement.
The Federal Reserve has just announced to increase the interest rate on crypto by 75-points. The announcement came after the latest Consumer Price Index showed an inflation rate of 8.3%. These reports came out in August, and the inflation rate was significantly higher than what was expected.
On Wednesday, the U.S Central Bank revealed that the interest rate will be increased by another 75-points, pushing the total Fed’s interest rate to 3.25%.
The crypto market initially responded quite well to this announcement as we saw an approx. 1.6% increase in the total market cap in the past 24 hours. However, both Bitcoin and Ethereum dropped a little and seem to be losing momentum on the lower timeframes.
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Bitcoin (BTC) Update
The main resistance level to watch for Bitcoin is still the $19,600 mark. It is the level that Bitcoin needs to flip to shift the momentum on the positive side once again. After the Fed announcement, we did see the price retest the $18,000 mark, and now it seems to be correcting towards the upside.
The price also dropped below the 50-SMA, and it will also be acting as resistance for BTC in the coming hours. The immediate resistance level to watch for BTC right now is the $19,000 mark.
On the other hand, the support we are watching for Bitcoin is still the $18K region. If the price starts closing daily candles below this level, we will see the bears dominate the market in the coming days.
The price previously put in a bottom at the $17,600 mark, and breaking below it will take Bitcoin to the lowest levels it has touched in the last couple of years.
Ethereum (ETH) Update
Ethereum had a strong reaction to the Fed announcement and fell significantly on the lower timeframes. The price dropped approximately 5% after rejecting the resistance at $1,400. ETH went as low as $1,220 and now seems to be correcting towards the upside.
Right now, the resistance level we are watching for Ethereum is the $1,310 mark. The price is gaining some momentum now, but it will be interesting to see how it reacts to the resistance level. The selling pressure is now increasing, and the downtrend could also continue. The support level we will now be watching for Ethereum is the $1,240 mark.
Other Cryptocurrencies Update
Other cryptocurrencies also responded to the news, and most of them did lose some steam immediately. Cardano (ADA) is now trading below $0.45 and could also retest $0.40. Solana (SOL) is also moving towards the $30.00 mark, and it is likely that the Binance Coin (BNB) will also retest the lower level, around $255.
DOGE is also trading below the $0.060 level and will likely revisit the support at $0.055 before it tries to retest $0.60 again.
Ripple (XRP), on the other hand, is still consolidating above the support at $0.40 and could move further up in the short term.
Some altcoins that still looked bullish in the past 24 hours included UNI, ALGO, COMP, KSM, and CEL.
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