Bitcoin (BTC) and the broader financial markets faced a new wave of sell-offs on June 18 after James Bullard, president of the US Federal Reserve in St. Louis, indicated that he was expecting an initial rate hike in late 2022.
Bullard’s comments were even more aggressive than Fed Chairman Jerome Powell’s comments on Wednesday, who indicated the rate hikes would come in 2023. Powell’s comments sparked a sell-off in financial markets as the US dollar strengthened.
Data from Cointelegraph Markets Pro and TradingView show that as the dollar strengthened, the bitcoin bulls were overwhelmed by sellers, causing it to fall to a daily low of $ 35,129.
The uniform sell-off on a wide variety of assets, including stocks, gold, and cryptocurrencies, has further eroded the narrative that Bitcoin is an uncorrelated asset, as data shows that BTC’s correlation with both gold and stocks in 2021 has increased further.
Traditional markets close the week
Friday’s close of trading in traditional markets was one of the worst weeks for the Dow since October, after dropping five straight times that week, an overall decline of 3%.
The S&P 500 and NASDAQ were also hit hard on Friday, closing the day 1.31% and 0.92% respectively, while the 10-year government bond fell 4.04% in response to the strengthening dollar .
As for the cause of the Fed’s recent restrictive stance, Bullard pointed to higher than expected inflation levels as the economy reopens after the Covid-19 lockdowns.
“We expect a good year, a good reopening. But this is a bigger year than we expected, higher inflation than we expected. I think it is natural that we should be a little more restrictive here in order to contain inflationary pressures. “
Bullard suggested that future inflation “stands at 3% this year and 2.5% in 2022 before falling back to the Fed’s 2% target.”
Altcoins price is crumbling
Altcoins, along with Bitcoin, saw its price decline on Friday as traders once again fled to the safety of stablecoins as market volatility increased.
Ether (ETH) fell more than 13% to a low of $ 2,137 and Amp (AMP) fell 33% from its all-time high of $ 0.1211 set on June 16.
Connected: Bulls are reluctant to buy the dip after Bitcoin price fell to nearly $ 35,000
Of the top 200 coins, the two best performances of the day were ZKSwap (ZKS) with a gain of 14% Gnosis (GNO), which increased by 7.4%.
The total market cap of the cryptocurrency is now $ 1.486 trillion and the dominance of Bitcoin is 44.8%.
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