Crypto Volatility Continues as FOMC Minutes Reveal Rising Inflation

• Bitcoin (BTC) consolidated marginally below $17,000, as market volatility remained high following the release of the latest Federal Open Market Committee (FOMC) minutes.
• Ethereum (ETH) also consolidated near recent highs on Thursday, with sentiment remaining somewhat bullish.
• The FOMC have seemingly agreed to maintain interest rate hikes, with the bank expecting a more aggressive rise in inflation, forecasting consumer prices to be at 3.5% in 2023.

The crypto markets have been in a state of flux recently, as the Federal Open Market Committee (FOMC) minutes released yesterday indicated that the U.S Federal Reserve could keep hiking rates in the near future. This comes as the bank expects a more aggressive rise in inflation, forecasting consumer prices to be at 3.5% in 2023, higher than the 3.1% previously expected.

In response to this, Bitcoin (BTC) consolidated marginally below $17,000, as market volatility remained high. Following a high of $16,964.59 on hump day, BTC/USD slipped to an intraday low of $16,789.75 earlier in the session. From a technical perspective, the decline in price came as the 14-day relative strength index (RSI) moved below a resistance zone of 51.00. As of writing, the index is now tracking at 49.14, and seems to be moving towards a support level of 46.00.

Ethereum (ETH) also consolidated near recent highs on Thursday, with price dropping to a bottom of $1,246.21 earlier in the day. Despite the drop, sentiment remained somewhat bullish, as ETH continues to trade above its long-term resistance level at $1,230. This is evidenced by the 10-day (red) and 25-day (blue) moving averages, which remained close in proximity, maintaining chances of an upwards crossover.

Overall, the crypto markets reacted to the FOMC minutes with caution, as traders remain uncertain of the future direction of the markets. It remains to be seen how the markets will respond in the coming days and weeks, as the U.S Federal Reserve continues to adjust its policy in response to rising inflation.