Cryptocurrencies are following the decline in international markets and are taking losses after US Federal Reserve (Fed) Chairman Jerome Powell warned against premature easing of monetary policy, with Bitcoin hovering just above $20,000.
“Powell’s admission that there will be pain before there is relief is hawkish,” said Josh Olszewicz, head of research at digital asset fund manager Valkyrie Investments.
According to investing.com, the world’s largest cryptocurrency is down 3.35% in the last 24 hours to $20,721.6, putting it on track for a second straight weekly loss. Since last Friday it has been trading in a range around $22,000 to $20,000. Ether, meanwhile, fell for the first time in four sessions, and is also down for a second week, down 7.24% to $1,575.32.
However, some analysts say the recent trading trend is a buying opportunity.
Powell’s remarks hinted that the U.S. central bank is likely to continue raising interest rates and leave them elevated for some time to rein in inflation, and he dismissed any notion that the Fed would soon reverse course. Low interest rates are seen as one of the catalysts that pushed investors into cryptocurrencies during the lockdowns due to the coronavirus pandemic.
Source: Capital
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