Leading digital assets continued to grow despite rise in key interest rate range fed immediately by 75 basis points. According to CoinGecko, the capitalization of the cryptocurrency market increased by 8% on the day, exceeding the level of $ 1.1 trillion.

In the same period, Bitcoin price increased by 9.5%, Ethereum price increased almost 14%. At the time of writing, the first asset is trading around $23,150 while the second is trading around $1,645.

According to Coinglass, liquidations in the futures market have exceeded $385 million in the last 24 hours, with more than $170 million in Ethereum. It basically replaces forcibly closed short positions.

The traditional stock market also reacted to the Fed’s decision with growth. As a result of the trading session on July 27, the Nasdaq Composite index rose 4%, the S&P 500 rose 2.6%, and the Dow Jones indicator – 1.37%.

According to Alfonso Peccatiello, former head of ING bank’s securities division, the markets’ reaction is linked to the words of Fed chairman Jerome Powell about possible easing of monetary policy in the future.

Peccatiello noted that current rates are in line with “neutral,” according to the official. He explained that this situation no longer contributes to “overheating or cooling the economy.”

…’we are now generally in line with our estimates of neutral interest rates, and after the bootstrapping of our walking cycle so far, we will be much more data-dependent going forward”.

Let’s find out why this is so relevant.

3/

— Alf (@MacroAlf) 27 July 2022

According to the expert, Powell’s words can be considered a refusal to raise interest rates further. At the same time, investors expect lower inflation and future economic growth, which is good for high-risk assets like bitcoin.

“It is possible to rationalize the later embedded narrative. FOMC, but due to a lack of forward guidance, we are highly volatile in the Fed’s actions. One small step towards tightening and everything is gone,” he added.

Analyst Michael van der Poppe also noted that Powell tends to loosen monetary policy. He emphasized that Ethereum’s transition to Proof-of-Stake and events around Three Arrows Capital and Celsius are “already priced” have had a positive impact on the markets.

The expert expects Ethereum to rise to $2,400 and Bitcoin to $28,000-30,000.

Ideal materials for the Summer Aid Rally include:

▫️ Powell is getting more dovish on policy and more dependent on data.
▫️ $ETH The merger is coming in September.
▫️ Heavy impact on 3AC, Celsius and more is already priced.

I see $ETH $2,400 and $BTC $28,000-30,000 USD.

— Michaël van de Poppe (@CryptoMichNL) 27 July 2022

According to economist Alex Krueger, the drop in quotes could still be due to bad company reports or a negative forecast for US GDP.

Today’s upward move, the very big crypto funds that missed it, must now be praying for Amazon or Apple to report dire gains tomorrow, or for a negative GDP pressure (unlikely) to load the dip.

— Alex Kruger (@krugermacro) 28 July 2022

“Today’s rally was so big that crypto funds that missed it should pray that Amazon and Apple report dire gains tomorrow or a negative GDP outlook (unlikely) is presented that could trigger the drop,” he wrote.

Recall that Raul Pal, a former senior executive of Goldman Sachs and macro investor, announced that there is a trend reversal in the cryptocurrency market in light of the growth of global liquidity.

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