The Federal Reserve’s attempt to put the dampers on markets by stating that the first rate cuts might not take place in March may not have worked. Stock markets have reacted by opening in the green, and now select altcoins are following. Oracles $LINK and $PYTH are among those leading.
Perhaps the market is not fooled
The crypto market was down in the lead-up to the Federal Reserve’s January FOMC meeting, and continued a bearish bias during and after the meeting. However, now that markets have had time to digest Powell’s assertion that interest rates will likely not be cut in March, perhaps a healthy disbelief has taken place.
The Federal Reserve has always leaned quite heavily on an ability to ‘talk down’ the markets when this has been necessary. Generally this has always had its damping effect on a market that, in the Fed’s perception, is becoming too exuberant and frothy.
Although the overall effect of Powell’s speech was termed as ‘dovish’ by most commentators, Powell did take care to try and negate the market’s notion that interest rates would need to be cut soon. He would have certainly borne in mind that a cut in interest rates would give the signal that the ‘Fed pivot’ had begun, and that far more liquidity would be entering markets.
That said, Thursday has opened in the green. This could imply that the market is not going to be fooled by Powell, and with the market being forward-looking by around 6 months, it is probably anticipating the entry of more liquidity sooner, rather than later.
$BTC holds and some altcoins surge
The less bearish environment in the crypto market, although still in an early stage, is now starting to be noticeable. $BTC has failed to fall through its bullish trend line as many had expected, and is still consolidating safely above; at least for now.
$LINK continues its bullish momentum
Source: Coingecko/Trading View
As the first altcoins turned green, $LINK has been one of the cryptos to maintain its upside momentum, even when everything else was down. Now the bias is turning bullish, $LINK is up around 10%, and has broken out of its trend.
$PYTH approaching price discovery
$PYTH is a relative newcomer to crypto, but already, the Solana-based oracle is supplying feeds to many more blockchains than LINK, its ethereum competitor.
Source: Coingecko/Trading View
The $PYTH price has managed to remain above its own upward trend line, and has reached the resistance at $0.446. If it can break this resistance, a new all-time-high awaits at $0.558, with price discovery beyond this. The future could be extremely bullish for this oracle.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
