Bitcoin holds onto 10% gains ahead of crucial Fed rate hike comments

Bitcoin (BTC) held onto caller upside connected Tuesday aft a resurgent banal marketplace took the largest cryptocurrency supra $37,500.

BTC/USD 1-hour candle illustration (Bitstamp). Source: TradingView.

Fed whitethorn spark caller volatility

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD trading supra $36,000 connected Tuesday, with maximum 24-hour gains totaling 14% versus Monday's floor. 

Bitcoin's correlation to equities remained successful absorption up of a caller Wall Street unfastened and cardinal accusation regarding involvement rates from the United States Federal Reserve.

The Fed's Federal Open Market Committee (FOMC) is acceptable to conscionable Wednesday, and immoderate quality regarding involvement rates could person instant repercussions for some accepted and crypto markets.

"Tomorrow's FED FOMC gathering could mean that we volition spot tons of volatility this week," Cointelegraph contributor Michaël van de Poppe forecasts.

Rate hikes are planned to beryllium the follow-on from the Fed's plus acquisition tapering, with Bitcoin sentiment taking a deed successful beforehand arsenic the extremity of "easy" liquidity nears.

Asset purchases should reason by March, however, and the Fed has said that the complaint hikes should not travel earlier then.

"Price reversion successful cryptos is apt to dispersed successful 2022, aft the assets were a poster kid of speculative inflationary excess successful 2021, but Bitcoin stands to travel retired ahead," Mike McGlone, main commodity strategist astatine Bloomberg Intelligence, summarized successful a hopeful outlook for BTC.

"Correlations are heading toward 1-to-1."

BTC/USD vs. S&P 500 correlation chart. Source: Mike McGlone/ Twitter

Earlier this month, McGlone said that Bitcoin could rebound stronger than stocks erstwhile they spot a long-overdue correction of up to 20%. Now, helium added that altcoins would apt neglect to enactment successful arsenic coagulated a comeback.

Major altcoins hitch retired earlier fall

On the taxable of altcoins, these nevertheless enactment successful a coagulated show connected the day, with Ethereum (ETH) matching Bitcoin's advance.

Related: ‘Stop panic selling’ — Bitcoin whales container spare BTC arsenic speech balances fall

ETH/USD was up 7.3% astatine the clip of writing, trading astatine $2,420, having erstwhile deed lows of $2,160, its worst since mid-July.

ETH/USD 1-hour candle illustration (Bitstamp). Source: TradingView.

Something of a V-shape betterment was besides noticeable connected different large-cap altcoins, including Binance Coin (BNB) and Solana (SOL).

"The bully portion is that we're getting person and person to the adjacent impulse rally connected altcoins arsenic astir of them person been retracing fully," Van de Poppe argued earlier the rally.