01.02.202317:35 Forex Analysis & Reviews: Bitcoin fell slightly ahead of the Fed meeting.

The bitcoin cryptocurrency is steadily rising toward $24,350, but the closer it gets to that point, the more challenging it is to increase. Buyers have started to act more carefully during the past week. Perhaps this is because the Bank of England, ECB, and Fed are all meeting soon. Trading tends to be less risky and less active before such significant events. However, bitcoin continues to rise, and the current level of $24,350 appears to be the upper limit of the side channel. We believe that the possibility of a rebound from this level and the continuation of the sideways trend are more likely than the further growth of the world's first cryptocurrency.

In general, we don't anticipate anything noteworthy from the evening summary of the Federal Reserve meeting's outcomes. It should be noted, however, that surprises are possible. As a result, some experts have started to hypothesize that the Fed would decide against raising rates earlier than most market participants anticipate. Recall that during the past few weeks, practically all of the members of the American regulator's monetary committee have stated that the rate has to be raised further. The more that the Fed's hawkish attitude softens, the better for bitcoin. However, we believe that this factor has already been taken into account because the recent round of growth was entirely driven by the US inflation report, which also significantly reduced market expectations for Fed rate hikes.

The upcoming report on American inflation will be quite useful. The likelihood of not raising the rate in March will grow above 50% if inflation shows a fall for the seventh consecutive month. All of this is to bitcoin's advantage, but keep in mind that we are still discussing tighter monetary policy, not easing it. Later, the focus will be on keeping rates high for an extended period. Safe investments will continue to be in greater demand than cryptocurrencies throughout this time. We do not now consider the rise of bitcoin the start of a new "bullish" trend. It is important to realize that pullbacks and upward corrections can happen even on "bearish" trends. However, it should be noted that the fundamental context for "bitcoin" improved in January, and its rate is determined by market sentiment rather than Fed rates.

The decline to $12,426 is currently being delayed because the quotes for "bitcoin" have surpassed the level of $18,500, as seen in the 24-hour timeframe. The cryptocurrency is currently increasing by $24,350. A rebound from this level might return bitcoin to a downward trend while breaking through it could cast doubt on the continuation of the "bearish" trend. We do not think that the "bullish" trend has already started, and we do not anticipate that there will be any further declines in the price of bitcoin in 2023. For "bitcoin," the fundamental background is still fairly complicated.