Bitcoin price hits 1-week lows as Fed rate hike rumors unsettle market
Bitcoin (BTC) dipped further below $19,000 on Oct. 21 as rumors circulated over the United States Federal Reserve.
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD abruptly dropping before the Wall Street open, hitting lows of $18,660 on Bitstamp.
A recovery took the pair higher, and it was attempting reclaim $19,000 as support at the time of writing.
The action came as commentators claimed the Fed was softening its policy on rate hikes ahead of the Nov. 1–2 Federal Open Market Committee (FOMC) meeting.
Citing mainstream media quotations from Fed officials, they suggested that the November hike could be the last 75-basis-point adjustment, with smaller ones following.
“Some officials are more eager to calibrate their rate setting to reduce the risk of overtightening,” Nick Timiraos, chief economics correspondent at the Wall Street Journal, summarized.
Timiraos came in for skepticism following his words, with some accusing him of "leaking" data which would be sensitive for markets.
"How silly that there's a designated Fed leaker that can drop a timely tweet thread and instantly impact global markets," popular commentator Stack Hodler wrote.
According to CME Group’s FedWatch Tool, the odds of a 75-basis-point hike next month remained almost guaranteed, with a mere 6.2% chance of 50 basis points.
U.S. equities saw a confident start to trading on the day, while the U.S. dollar swiftly lost ground after earlier causing fresh pain for trading partner currencies.
Related: Global recession may last until near 2024 Bitcoin halving — Elon Musk
The U.S. dollar index (DXY) was below 113 at the time of writing, having spiked to near 114 hours prior.
“It’s all about DXY and the consolidation between recent highs and D1
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