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The crypto market witnessed a splendid recovery, starting the year with positive sentiment among traders. A broader market rally continued over the month as Bitcoin price rallied over 40% in January to hit a high of $23,861 on January 29.
While investors were happy with the bull run, experienced traders expected a pullback as the crypto market enters a crucial week with many global events that can impact its bull run. A broader market-wide selloff was seen today, with Bitcoin price falling over 2% in just a few hours.
Also Read: Why Is Crypto Market Crashing Today, Is Bull Run Over?
Key Events To Watch This Week
1. Interest Rate Hike By the U.S. Federal Reserve
The U.S. Federal Reserve will announce its interest rate hike decision during the FOMC meeting on Wednesday. The market expects the Fed set to shrink interest rate hikes and go with a 25 bps rate hike. However, the possibility of a 50 bps rate hike is still on the table.
Treasury Secretary Janet Yellen and Tesla CEO Elon Musk have warned that the U.S. economy is at risk of a severe recession. Despite cooling inflation and strong jobs data, Yellen believes high interest rates put recession at increased risk.
According to the CME FedWatch Tool, there’s a 99.9% probability of a 25 bps rate hike by the U.S. Federal Reserve. The rate hike decision will be followed by Fed Chair Jerome Powell’s speech outlining a hawkish and dovish approach.
2. European Central Bank and Bank of England’s Interest Rate Hike
The European Central Bank is set to deliver 50 bps interest rate hikes in the next two meetings in February and March. ECB President Christine Lagarde asserts the need for further monetary tightening and raising interest rates to bring down inflation.
The Bank of England is estimated to announce a 50 bps rate hike on Thursday, an hour before the ECB rate hike decision.
3. Quarterly Results By Tech Giants
The crypto market has a correlation with the U.S. stock market, with Nasdaq 100 having a strong correlation with Bitcoin price. With tech giants such as Meta, Apple, Google, and Microsoft announcing their quarterly results this week, Bitcoin price is likely to be impacted.
The tech giants are also associated with the crypto market with their technological developments related to NFTs, metaverse, and blockchain.
4. U.S. Non-Farm Payrolls and Unemployment Data
The U.S. Bureau of Labor Statistics will release the non-farm payrolls and unemployment rate data for January. The non-farm payroll data is estimated at 185,000. The US economy added 223,000 jobs in December 2022.
Moreover, the unemployment rate is estimated at 3.6 percent. The unemployment rate in the U.S. dropped to 3.5 percent in December 2022.
Also Read: Janet Yellen, Elon Musk Warns Severe Recession, Will Crypto Crash Again?
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