Bitcoin showed little immediate reaction to the Federal Reserve’s rate increase before recovering toward $78,000, while traders continued to assess whether the post-hike rally can avoid a repeat of 2022’s sharp reversal.
Bitcoin absorbs the Fed decision, then rebounds
The Federal Reserve’s rate-hike vote was unanimous, but Bitcoin had little immediate reaction to the announcement and held near $76,000 before and after the decision. It later recovered from $75,972 overnight to just below $78,000.
The recovery gathered momentum, but derivatives remained volatile
Bitcoin rose 1.35% over 24 hours and moved above $78,000 during the European morning. The move came against a leveraged backdrop: roughly $470 million of short crypto-derivatives positions were liquidated over the same period.
The rate hike was largely anticipated, while Bitcoin’s market links shifted
The expected 25-basis-point rate increase was largely priced in, helping explain Bitcoin’s limited immediate reaction. In reported short-window measures, Bitcoin’s correlation with the Dollar Index was nearly zero, while its correlation with the S&P 500 was 0.43 and with the Nasdaq was 0.30.
The 2022 comparison cuts both ways
Bitcoin was already down roughly 40% when the Fed first raised rates in March 2022, then rallied about 18% over the following 12 days before subsequently falling around 50%. The comparison comes as core inflation has eased to 2.4%, although the earlier post-hike rally did not prevent a much deeper decline.
Support levels and the distance from the record remain key markers
The reported support levels for Bitcoin are $70,000 and the $62,000-$65,000 range. Bitcoin is trading at about $78,000, up roughly 32% for the quarter but still about 40% below its October record high.