BTC Consolidates as FOMC Indicates Further Rate Hikes Ahead

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Bitcoin consolidated slightly below $17,000 as market volatility remained elevated following recent Federal Open Market Committee (FOMC) minutes. At the December meeting, the US Federal Reserve agreed to keep rates rising as inflation was still near historic highs. Ethereum also remained close to recent highs on Thursday.

Bitcoin

Bitcoin (BTC) mostly consolidated on Thursday as the price failed to break out of the key $17,000 level yesterday.

After hitting a high of $16,964.59 on the day of the bump, BTC/USD slipped to an intraday low of $16,789.75 earlier in the session.

The decline comes as markets reacted to the final minutes of the FOMC, where the Fed apparently agreed to hold interest rate hikes.

BTC/USD – Daily Chart

It comes as the bank expects inflation to rise more aggressively, forecasting consumer prices at 3.5% in 2023, higher than the 3.1% previously expected.

Looking at the chart, the price drop also occurs when the 14-day Relative Strength Index (RSI) broke below a resistance zone of 51.00.

At the time of writing, the index is now trailing at 49.14 and appears to be heading towards a support level of 46.00.

Ethereum

In addition to BTC, Ethereum (ETH) also consolidated in today’s session, with a slight change in momentum on Thursday.

ETH/USD fell to a low of $1,246.21 earlier in the day, which comes less than 24 hours after hitting a high of $1,264.81.

Despite the decline, sentiment remains somewhat bullish as ETH continues to trade above its long-term resistance level at $1,230.

ETH/USD – Daily Chart

From the chart, the 10-day (red) and 25-day (blue) moving averages also remain close to each other, which keeps the chances of an upward crossover.

This seems to be one of the factors in place keeping the bullish sentiment alive. However, with the RSI now dropping, that might start to change.

Since it failed to break out of a ceiling at the 57.00 level, price strength is now at 55.40.

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Could we see bullish momentum returning to Ethereum this week? Leave your thoughts in the comments below.

Elie Dambell

Eliman brings an eclectic perspective to market analysis, having previously served as a brokerage director and retail educator. Currently, he acts as a commentator on various asset classes including Crypto, Stocks, and FX.

Image credits: Shutterstock, Pixabay, Wiki Commons

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