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Why Did Bitcoin Drop Below $37,000 Despite the FOMC Push? Will BTC Price Hit $30,000 This Week?

6 May, 20223 min readBitcoin
Why Did Bitcoin Drop Below $37,000 Despite the FOMC Push? Will BTC Price Hit $30,000 This Week?

Bitcoin price and the major crypto assets witnessed a steep fall with minutes of the stock market began its operation for the day. Interestingly, the crypto space had received a bullish push, a couple of hours before as the FOMC announced a hike in the interest rates by 50 basis points to combat the inflation. With the push, BTC’s price was on the verge to hit $40,000 after a 5%-6% hike. However, the fresh plunge now indicates the bearish trend may prevent the price from a strong recovery.

But why did Bitcoin(BTC) price plunge so hard?

Major Banks Letting Out Warnings!

The United States recently recorded a 4-decade highest inflation rate of nearly 8.5% and hence increased the interest rates by half-per cent. In a recent update, the Bank of England also has predicted similar inflation for the state which may be the major reason for the investors just pulling out their holdings. The Bank of England has increased the interest rates to a 13-yr high and also expects the inflation to hit 10%, which is the highest since 1982.

Wall Street Crash

The US Stocks closed sharply on Thursday as investor sentiment turn to extreme fear as the FED’s hike in the interest rates may not be enough. And hence may more hikes may make their way out to tame the surging inflation. Currently, no fundamentals or technicals are been looked at as the sentiments dominate the majority of the market. Therefore, a major crash may be awaited in the upcoming days that may impact the crypto space largely.

Heavy BTC Long Liquidations

While the FED rate increase had fueled some bullish momentum in the crypto space, the fear monger among the investors. The Bitcoin futures witnessed huge liquidations that it failed to record since the beginning of 2022. As per the data from Coinglass, nearly $164.75M liquidations in the past 12 hours, which lead to a huge free fall in the BTC price.

Can We Expect A BTC Price Rebound?

Bitcoin price after the free fall is accumulating extremely hard within a very narrow range. And hence it appears that the asset may make a positive move after accumulating for some time. However, on the contrary, the asset is primed to pull a significant leg towards the south whipping another 10% from its value soon. The reason may be the bulls and the investors may remain silent until the market sentiments vary and mainly, the BTC price has formed a significant bearish flag. Therefore, the price hitting the levels below $35,000 may be imminent.

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