Bitcoin (BTC) dropped to $66 thousand, triggering $250 million in cryptocurrency liquidations. This has left traders ready for a 'Crazy Wednesday' of FOMC and CPI reports.
The Fed's “dot plot” of interest rate forecasts and Chairman Powell's forward guidance will be key to what's next for the digital asset market, according to K33 Research. This information is expected to be announced tomorrow.
Bitcoin could have a volatile session on Wednesday as it has been “quite sensitive” to economic data lately. As noted in today's market update by K33 Research, BTC's 30-day correlation with US stocks is climbing to its highest level since 2022.
“The stage is set for a wild macro-Wednesday, with both May CPI data and the Fed's interest rate decision poised to move the market,” K33 analysts said.
Investors will closely watch the Federal Open Market Committee (FOMC) members' interest rate outlook, called a “dot plot,” to see how many rate cuts policymakers are projecting for this year. This comes in light of recent sticky inflation data and softer economic data.
“The FOMC dot chart, along with forward guidance during Jerome Powell's press conference, will likely be the most important price triggers as BTC reignites the market's interest rate expectations,” K33 Research added.
*This is not investment advice.
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