Bitcoin price dipped below $23K as investors await the next utterances from Fed Chairman
Bitcoin price traded below $23,000, falling along with U.S. stocks as worries about future interest rate hikes to control inflation and the economy’s growth were stoked by surprisingly positive employment growth figures released on Friday. At the time of writing, BTC is changing hands at $22,921.
BTC/USD 4-hour chart | Source: TradingView
Bitcoin price falls below $23,000, Ether drops as crypto market follows equities lower
With Bitcoin down 1.7% and Ether down 2.3% over the weekend, the prices of major digital assets were flat. The world’s largest digital asset and several other cryptocurrency categories had a great month of January, with certain metaverse tokens posting triple-digit increases and Layer-1s, such as Aptos’ APT, surging by over 300%. Even some positive perspectives forecast that bitcoin will reach $45,000 before Christmas.
All of the top 10 non-stablecoin cryptocurrencies, including Ether, decreased. BNB experienced the least loss, while Dogecoin and Polygon were the biggest losers. Ether is down 0.9% the same week after losing 2.1% to $1,631.
“Three of the more polarizing assets in crypto, Cardano, Shiba Inu, and Hex, are seeing big spikes in large whale transactions. When $100k+ transactions spike on a network, it historically is associated with upcoming price shifts. Monitor closely” Santiment reported.
Despite dropping 3.8% to $0.09, Dogecoin was still up 2.1% for the week. To change hands at $1.20, Polygon lost 3.8%, capping a weekly gain of 2.2%. BNB decreased 0.8% to $327.85 but remained up 3.3% for the week.
With trading volume increasing by 27.4% to $48.9 billion, the crypto market capitalization decreased by 2% to $1.07 trillion.
According to data released by the U.S. Bureau of Labor Statistics on Friday, the number of nonfarm payroll jobs increased by 517,000 in January, significantly more than the 185,000 projected and more than double the 260,000 jobs registered in December. At 3.4%, the unemployment rate in the US is at its lowest level since 1969.
The increase in employment and the positive U.S. services sector data, also released on Friday, are indicators of a healthy economy. However, investors appeared alarmed by the data because they perceived it as evidence of persistently high inflation, which could lead to a stronger interest rate response from the U.S. Federal Reserve.
The substantial rate increases made by the U.S. Federal Reserve last year appear to be having the anticipated impact on inflation. The consumer price index in the United States increased 6.5% year over year in December, much less than the 7.1% recorded in November and the biggest monthly decrease since April 2020.
Interest rates in the United States are currently between 4.5% and 4.75%, the highest level in 15 years. Fed officials have frequently said they may increase rates to as high as 5% to get inflation back to within the 2% range.
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