Bitcoin is struggling to hold the $20,200 support after the latest interest rate hike

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(Kitco News) – The highly anticipated 75 bps interest rate hike announcement from Federal Reserve Chairman Powell came and went on Wednesday without much impact on the broader crypto market, suggesting it was already priced in.

“This decision was as expected and so the market has already prepared for it,” said Damian Scavo, CEO and founder of Streetbeat. “Given the recent rise in interest rates, we expect to see inflation cool in November and see better news for the market as soon as December, despite ongoing stock market volatility amid the crisis in Ukraine.”

Volatility in both crypto and traditional markets spiked shortly after Powell’s announcement. But the price action has since calmed as the day fell in line with what the majority of analysts expected.

Data from TradingView shows Bitcoin (BTC) whipped up in response to the interest rate hike, trading as high as $20,811 and hitting a low of $20,210, with bears now trying to push for further declines.

BTC/USD 4-hour chart. Source: TradingView

The resumption of sideways trading for Bitcoin on the daily chart “is not bearish – yet,” according to Kitco senior technical analyst Jim Wyckoff, who noted that “A new price uptrend remains in place on the daily bar chart.”

According to Wyckoff, bulls still have the overall technical advantage in the near term, but they will need to show new strength soon to keep it.

What comes next

A positive view of what’s coming next was provided by cryptocurrency analyst Michaël van de Poppe, who posted the following tweet noting the possibility of a short-term correction to $20,000 before a resumption of the uptrend.

Still the view I have #Bitcoin.

A sweep of the $20K lows would trigger continuation in the markets, and such a sweep is common during the FOMC, after which we continue towards $22.5K.

You can buy dips tonight. pic.twitter.com/ZOaYRibKIw

— Michaël van de Poppe (@CryptoMichNL) 2 November 2022

But not everyone is optimistic that prices will go higher from here, including pseudonymous cryptoanalyst il Capo of Crypto, who gave the following price targets for BTC and ETH before the market turns and establishes new lows.

Plan for November:

-Pump to 21000-21500 for the last phase of the distribution. ETH to the 18th century.
-Altcoins also have the latest scam pumps. People who call for all season.
– Start of the reversal to new lows.
-Mega nukes after midterms. BTC at 14k and ETH at 700-800.

GL!

— il Capo Of Crypto (@CryptoCapo_) 2 November 2022

Prices are starting to go south

As the dust began to settle after the fourth consecutive 75bps rate hike, both crypto and traditional markets began to decline.

The S&P, Dow and Nasdaq all briefly traded in the green around the time of the rate hike announcement, but reversed course as the day progressed to close down 2.5%, 1.55% and 3.36% respectively.

The altcoin market similarly took a turn for the worse in the afternoon, resulting in the vast majority of tokens seeing the red for the day.

Daily performance in the cryptocurrency market. Source: Coin360

Notable exceptions to the overall weakness include Mask Network (MASK), Render Token (RNDR), and ConstitutionDAO (PEOPLE), which are at 66%, 25.48%, and 23.33% respectively at the time of writing.

The total cryptocurrency market cap is now $1.02 trillion, and Bitcoin’s dominance rate is 38.8%.