Bitcoin ( BTC ) slipped below $43,000 today, Feb. 17, once again dampening hopes of a breakout of the existing price range.
Central bank plans increase
BTC/USD is currently trading in a slightly broader range, topping out at $44,500.
According to the latest statements from the American central bank, the crypto market leader was initially able to climb to this upper limit before going down again.
The Federal Open Market Committee (FOMC) of the US central bank, which is responsible for setting the key interest rate, announced a few days ago that an increase could probably take place as early as March, without wanting to make a precise decision.
"The Committee aims to achieve maximum employment and a long-term inflation rate of 2%," according to the accompanying statement . And further:
“In order to achieve these goals, the committee will initially keep the key interest rate in the range of 0 to 0.25%. However, since inflation is currently well over 2% and the labor market is currently strong, the key interest rate will soon be adjusted accordingly.”
The FOMC adds that it will also stop all bond purchases from March, which is in line with previous planning. For February, however, purchases of at least 30 billion US dollars are still being made.
However, the effect of this good news seems to be wearing off on the crypto market. Overall, the crypto experts nonetheless remain confident about the medium-term price development.
"My perspective has improved a bit, which is why I'm forecasting a rally to $53,000 by mid-March," said crypto analyst Pentoshi .
Other experts, in turn, point to the stability of the crypto market leader in recent weeks, because in the past there have been significantly more violent downward trends after record runs.
In January, for example, the so-called "miner capitulation" at 33,000 US dollars was successfully prevented . At this point, the Bitcoin price no longer covers the average production costs of the Bitcoin miners, which is why they gradually exit the market. The market leader was spared this fate, which proves its strength even in bad times.
Ukraine conflict causes unrest
The looming conflict between Russia and Ukraine is also causing some additional uncertainty, which is slightly dampening the improving mood.
Meanwhile, the stock market fell by 0.5%, which also provides little tailwind.
The situation on the Ukrainian border seems to be slowly easing again, but until the conflict is finally resolved, this uncertainty will affect risky financial products such as equities and cryptocurrencies.
Because of this, the high correlation between bitcoin and the stock market will remain in early 2022.
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