Powell's Comments Spark 1.3% Bitcoin Rise Amid Market Selloff

Federal Reserve Chair Jerome Powell's recent comments have cast a shadow over the recovery hopes of both crypto and stock markets. Speaking on Wednesday, Powell ruled out any immediate intervention or rate cuts, leading to a significant selloff in equities. This decision came as a surprise to many who had anticipated a potential policy shift from the central bank in response to recent market volatility. Powell emphasized that the markets are functioning as intended, despite growing uncertainties.

The market's reaction was swift and severe. Major U.S. indices experienced a sharp decline, with tech giants like Nvidia and Tesla seeing significant drops. The Nasdaq Composite and the QQQ ETF also mirrored this downward trend, reflecting the broader market sentiment of fear and uncertainty. The Fear and Greed index for the stock market registered a low reading of 14, indicating a high level of investor anxiety. In contrast, the crypto market showed marginally less fear, with a reading of 30, suggesting that while investors are cautious, crypto has maintained relative stability compared to traditional equities.

While the stock market faced a tumultuous period, the crypto market held its ground. Bitcoin, in particular, remained above $83,000 during the market turmoil and is currently trading at $84,612, marking a 1.3% rise in the past day. The Crypto Banter YouTube channel highlighted this resilience but warned that crypto markets often lag behind traditional market movements. This stability, while reassuring, may be short-lived, as crypto could follow the downward trend of stocks if the weakness persists.

Bitcoin now faces a critical test. A breakout above $85,500 could signal a move toward $90,000 and $93,000. However, failure to stay above $83,000 risks a broader selloff. According to Crypto Banter, Bitcoin is contending with triple resistance: the 50-day and 200-day moving averages and a key horizontal level. This resistance has kept the market range-bound, with rapid liquidation of both longs and shorts, suggesting a significant breakout is imminent. A close above current resistance could attract new buying interest, while a breakdown below support may confirm a delayed correlation with the falling stock market.

While Bitcoin holds steady, altcoins remain under pressure. Most are locked in downward trends with no clear signals of reversal. Ethereum, Solana, and SUI are all testing demand zones but haven’t confirmed a shift in momentum. Traders are advised to avoid taking heavy positions in altcoins until a stronger bullish structure emerges. The current environment favors caution, with the USDT dominance chart remaining elevated, signaling a risk-averse market. A breakdown in this chart could precede a bullish breakout in crypto, but until that happens, analysts recommend low-risk trading strategies and strict risk management.