Bitcoin
and other cryptocurrencies were little changed on Monday amid a quiet day for global trading, with U.S. markets closed for the Juneteenth holiday.
However, a macro catalyst lies in the days ahead as cryptos continue to stagnate in a familiar range.
The price of Bitcoin has fallen less than 1% over the past 24 hours to $26,400, losing ground from a weekend peak near $27,000. A rally last Friday—after money manager BlackRock (BLK) filed to create a Bitcoin exchange-traded fund—carried the largest digital asset back up above $26,000. Bitcoin is now back in the trading range from $26,000 to $27,000 that has dominated for much of the period since the token hit a 10-month high in April above $30,000—a level that has since proved hard to reclaim.
Federal Reserve chairman Jerome Powell is set to testify before Congress this week, speaking before the House Financial Services Committee and Senate Banking Committee on Wednesday and Thursday, respectively. Powell’s remarks have the possibility to be the next major catalyst for cryptos, prices of which have risen and fallen in response to the outlook for U.S. monetary policy.
“More downside risks could push Bitcoin lower, leaving it within the bearish trend,” said Alex Kuptsikevich, an analyst at broker FxPro. “Only a rally above $27,200—the area of previous local highs and the 50-day moving average—can effectively break this trend.”
The Fed’s campaign of interest-rate hikes over the past year was a key force driving down digital assets from their late 2021 peak, and Bitcoin’s rally of some two-thirds in 2023 has come amid expectations that the central bank’s work is almost finished. Last week the Fed hit the pause button on rates for the first time in this tightening cycle, but signaled that more rate increases could be ahead.
How hawkish Powell is before Congress—how much the Fed chief telegraphs more rate-hikes—will be a focus for investors across markets this week, crucial for cryptos just like the
Dow Jones Industrial Average
and
S&P 500.
Beyond Bitcoin,
Ether
—the second-largest crypto—lost less than 1% to $1,725. Smaller cryptos, or altcoins, were weaker, with
Cardano
dropping 3% and
Polygon
slipping 2%. Memecoins were more mixed, with
Dogecoin
down less than 1% and
Shiba Inu
up less than 1%.
Write to Jack Denton at [email protected]
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