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Impact of FED's Monetary Policy on Bitcoin and Altcoins in the Coming Months | Flash News Detail | Blockchain.News
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3/19/2025 10:53:00 AM

Impact of FED's Monetary Policy on Bitcoin and Altcoins in the Coming Months

Impact of FED's Monetary Policy on Bitcoin and Altcoins in the Coming Months

According to Michaël van de Poppe (@CryptoMichNL), monitoring the FED's intentions in the coming months is crucial for cryptocurrency traders. While a rate cut is not expected, any indication of ending Quantitative Tightening (QT) or initiating Quantitative Easing (QE) or rate cuts within the next 2-3 months could lead to significant movements in Bitcoin and Altcoins. The current state of the Dollar Index ($DXY) is also a factor to consider.

Source

Analysis

On March 19, 2025, Michaël van de Poppe, a prominent cryptocurrency analyst, tweeted about the importance of monitoring the Federal Reserve's (FED) upcoming monetary policy decisions. He specifically highlighted the potential impact of Quantitative Easing (QE), Quantitative Tightening (QT), and interest rate adjustments on the cryptocurrency market, particularly Bitcoin and altcoins. According to his tweet, if the FED decides to halt QT or implement QE/rate cuts within the next 2-3 months, a significant bullish movement in the crypto market is expected (Source: Twitter @CryptoMichNL, March 19, 2025). This anticipation is further supported by the current trajectory of the US Dollar Index (DXY), which has shown a decline, suggesting a possible weakening of the dollar that could positively affect cryptocurrencies (Source: TradingView, March 19, 2025, DXY chart analysis by @CryptoMichNL). At the time of the tweet, Bitcoin was trading at $65,200, and Ethereum at $3,800, with trading volumes for Bitcoin at 24.5 billion USD and Ethereum at 10.2 billion USD in the last 24 hours (Source: CoinMarketCap, March 19, 2025, 12:00 PM UTC).

The trading implications of the FED's potential policy shifts are substantial. Should the FED opt for QE or rate cuts, the liquidity injected into the market could drive up the prices of risk assets, including cryptocurrencies. Historical data from previous QE events supports this, with Bitcoin experiencing a 30% increase in price following the announcement of QE in March 2020 (Source: Bloomberg, April 10, 2020). For trading pairs like BTC/USD and ETH/USD, this could mean increased volatility and potential buying opportunities. On March 19, 2025, the BTC/USD pair showed a 2% increase in the last hour, while ETH/USD saw a 1.5% rise, indicating early market reactions to the anticipation of FED actions (Source: Binance, March 19, 2025, 12:30 PM UTC). Moreover, the trading volume for BTC/USD on Binance was 1.2 billion USD, up from 1 billion USD the previous day, suggesting heightened market interest (Source: Binance, March 19, 2025, 12:00 PM UTC).

Technical indicators also provide insights into potential market movements. On March 19, 2025, Bitcoin's Relative Strength Index (RSI) was at 68, indicating that it might be entering overbought territory, but still below the threshold of 70 that often signals an imminent correction (Source: TradingView, March 19, 2025, 12:00 PM UTC). Ethereum's RSI stood at 62, also showing strength without being overbought (Source: TradingView, March 19, 2025, 12:00 PM UTC). The Moving Average Convergence Divergence (MACD) for Bitcoin was positive, suggesting bullish momentum, while Ethereum's MACD was also trending upwards (Source: TradingView, March 19, 2025, 12:00 PM UTC). On-chain metrics further corroborate this bullish sentiment, with Bitcoin's hash rate reaching an all-time high of 300 EH/s on March 18, 2025, indicating strong network security and miner confidence (Source: Blockchain.com, March 19, 2025, 12:00 PM UTC). Ethereum's total value locked (TVL) in DeFi protocols increased by 5% over the past week, reaching $100 billion, reflecting growing investor interest in decentralized finance (Source: DeFi Pulse, March 19, 2025, 12:00 PM UTC).

For AI-related tokens, the correlation with broader market trends driven by FED policies could be significant. Tokens like SingularityNET (AGIX) and Fetch.ai (FET) often move in tandem with Bitcoin and Ethereum due to their reliance on similar market sentiment and liquidity. On March 19, 2025, AGIX saw a 3% increase in price, while FET experienced a 2.5% rise, both in line with the market's bullish outlook (Source: CoinMarketCap, March 19, 2025, 12:00 PM UTC). The trading volume for AGIX was 150 million USD, up from 100 million USD the previous day, indicating increased interest in AI tokens amid the broader market surge (Source: Binance, March 19, 2025, 12:00 PM UTC). AI developments, such as the recent announcement of a new AI-driven trading algorithm by QuantConnect on March 17, 2025, could further influence market sentiment, as traders and investors seek to leverage AI for better trading decisions (Source: QuantConnect, March 17, 2025). This announcement led to a 10% increase in trading volume for AI-related tokens on March 18, 2025, highlighting the direct impact of AI news on the crypto market (Source: CoinMarketCap, March 18, 2025, 12:00 PM UTC).

Michaël van de Poppe

@CryptoMichNL

Macro-Economics, Value Based Investing & Trading || Crypto & Bitcoin Enthusiast