Bitcoin briefly dips below $43,000 as Fed says rate hike 'soon'

Bitcoin (BTC) dipped below $43,000 on Feb. 17, and volatility the day before raised hopes of an impending breakout.

Fed rate hike

Data from Cointelegraph Markets Pro and TradingView shows that BTC has slightly extended its trading range over the past 24 hours, reaching the upper limit of $44,500.

The bitcoin pair returned to the top of its intraday range overnight following the Fed's comments.

Minutes from the U.S. Federal Open Market Committee (FOMC) meeting in late January, which was expected to provide clues about a possible rate hike, ended up providing few surprises. A rate hike may come in March, but the parties have not made a firm commitment to the rate hike process.

"The Committee seeks to achieve maximum employment and inflation at 2 percent over the long run," the accompanying statement said.

"In support of these objectives, the Committee decided to maintain the target range for the federal funds rate at 0 percent to 1/4 percent. With inflation well above 2 percent and a strong labor market, the Committee expects to raise the target federal funds rate appropriately soon range"

The FOMC added that it aimed to halt asset purchases entirely in March, in line with its previous plan, after buying at least $30 billion in February.

With little new news, the cryptocurrency market entered a dull mood on Thursday. However, the optimism about Bitcoin’s price action over the past two weeks remains firmly in place.

“My bias has changed and now favors a squeeze towards 53k by mid-March,” popular trader and analyst Pentoshi said in his recent Twitter update.

Others have similarly pointed out that this month’s price performance has been relatively strong compared to previous occasions when Bitcoin pulled back from its all-time highs last November.

For example, a miner capitulation event — where miners were forced to sell or stop mining entirely because the spot price of Bitcoin fell below their production costs — was successfully avoided by rallying prices near $33,000 in January.

As Cointelegraph reported, support levels have been gradually rising in recent days as buyers bet on a potential decline that would be less steep than previously expected.

Tensions persist in Russian stocks, cryptocurrencies

Other macro signals on the day were renewed uncertainty over the conflict between Russia and Ukraine, with reports of hostilities emerging overnight.

Stock market futures were down at least 0.5% ahead of the open on Wall Street.

Earlier, the U.S. government called it "false" that Russia was trying to de-escalate the situation on the Ukrainian border, a claim that would have calmed nervous markets.

"Yesterday, the Russian government said it was withdrawing troops from the Ukrainian border ... We now know this was wrong," the Financial Times quoted a senior official as saying on Wednesday.

Bitcoin and altcoins remain highly correlated with stocks as 2022 progresses.