Bitcoin Tests $66K Support as Hawkish Fed Minutes Crush Rate Cut Dreams
Bitcoin just can't catch a break. After flirting with higher levels, BTC has tumbled to around $66,000, its lowest in recent sessions, as Federal Reserve minutes revealed a surprisingly tough stance on interest rates. Traders who were banking on cuts are now staring down the barrel of potential hikes, and it's rippling through risk assets like a shockwave. With U.S. stocks faltering and the Nasdaq sliding, Bitcoin's tight correlation to tech is putting it squarely in the crosshairs.
The Fed's latest minutes dropped a bombshell: several policymakers are now open to raising rates if inflation shows signs of sticking around. This hawkish pivot has evaporated hopes for imminent relief, strengthening the dollar and squeezing speculative bets across the board. Bitcoin, ever the risk-on poster child, felt the full force, dipping below key support and eyeing a fifth straight weekly loss—the longest streak since the 2022 bear market. On the charts, $66,000 has emerged as a battleground. A cluster of long liquidations worth nearly $1 billion lurks just below, ready to cascade if breached. Yet, history offers a sliver of comfort. Bitcoin has never violated its long-term power law support over 15 years of cycles, not even in the brutal 2018 or 2022 winters. Some analysts argue this dip to around $58,000 could be the ultimate buying opportunity if it holds—or the first crack in the foundation. The BTC-Nasdaq link is tighter than ever, with both slumping in tandem amid broader equity weakness. Coinbase shares flipped from gains to losses, and MicroStrategy tumbled alongside. It's a classic macro-driven retreat, where tighter policy expectations crimp liquidity for high-beta assets like crypto.
The fallout is widespread. Ethereum and Solana followed Bitcoin south, dragging the total crypto market cap lower. U.S. indices lost steam, with the Nasdaq down over 1%, amplifying the pain for correlated portfolios. A surging dollar index adds fuel to the fire, making dollar-denominated assets less appealing. Spot Bitcoin ETFs saw outflows, while trading volumes spiked on the volatility. If $66,000 gives way, paths open to $60,000, but resilient hands might view this as a chance to accumulate amid the fear.
This Fed-fueled dip is a gut check for Bitcoin bulls, but cycles teach resilience. With power law supports intact and historical precedents on side, the $66,000 test could mark a local bottom before the next leg up. Keep eyes on upcoming data prints and Fed speak—clarity might flip the script fast. For now, patience pays in this volatile game.
Sources:
- @Bitcoin
- @cryptorand
- @CoinDesk
- @clawstreet67