Bitcoin price dives pre-FOMC amid warning $17.6K low was not the bottom
Bitcoin (BTC) dropped to weekly lows at the Aug. 17 Wall Street open as upcoming Federal Reserve comments unsettled risk assets.
Dollar climbs as Fed minutes due
Data from Cointelegraph Markets Pro and TradingView tracked a more than 2% daily decline in BTC/USD, which hit $23,325 on Bitstamp.
Already showing signs of weakness, the pair slid further as United States equities began trading, hours before the Federal Open Markets Committee (FOMC) was due to release minutes from its latest meeting.
While not involving a decision on interest rates, the meeting was cued to give an insight into the Fed’s thinking in terms of the next rate tweak due in September.
“The important event tonight with the FOMC minutes, through which information can be received whether the FED is going to be hawkish or dovish,” Cointelegraph contributor Michaël van de Poppe summarized in his latest Twitter update.
“I don’t think it will have a massive impact, however, crypto tends to give it a ton of value and, therefore, lots of volatility.”
Stocks had hit major resistance in line with crypto during the week, leading some concerned sources to continue to predict a further major retracement across the board.
Justin Bennett, the founder of crypto education platform Crypto Academy, warned that the S&P 500 was copying behavior from immediately prior to the 2008 Global Financial Crisis.
“This is mind-blowing. The S&P 500 is mimicking the 2008 crash. Even the timing since the ATH is nearly identical,” he commented on a comparative chart.
“The bottom is NOT in for stocks or crypto.”
A telltale sign on the day came in the form of an advancing U.S. dollar, with the U.S. dollar index (DXY) seeking to attack resistance in place throughout August.
“$DXY could be on its way to 112-113 after the fakeout below 105.50. That’s going to weigh on stocks and crypto,” Bennett added.
Buyers eye lower bids
On shorter timeframes, the trend on Bitcoin was also rapidly losing steam as bid support inched down the Binance order book.
Related: Bitcoin price sees firm rejection at $24.5K as traders doubt strength
On-chain monitoring resource Material Indicators captured the action, concluding that “even if we get another pump, still believe the Bear Market Rally is losing momentum.”
An upside target could come in the form of the 100-day moving average, a separate post explained, lying at $24,544 at the time of writing.
“Been warning about this breakdown for Bitcoin the past few days,” commentator Matthew Hyland concluded.
“Structure has shifted overall weak recently. Market seemed to have its first signs of life just last week. That seems to be short lived.”
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