Bitcoin rally loses momentum as expectations for Fed shift eases Bitcoin rally loses momentum as expectations for Fed shift eases
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Bitcoin rally loses momentum as expectations for Fed shift eases

Bitcoin rally loses momentum as expectations for Fed shift eases

Bitcoin, the largest digital coin by market value, dipped as much as 2.9 per cent on Wednesday

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Bitcoin’s two-day resurgence ran out of steam after strong economic data dashed hopes for a relaxation in hawkish central bank policies.

Bitcoin, the largest digital coin by market value, dipped as much as 2.9 per cent on Wednesday to trade as low as $19,752, before trading little changed. That’s a reversal from the prior day’s trading, when Bitcoin moved above $20,000 to gain alongside the S&P 500 Index.

US stocks also slumped on Wednesday, dropping as much as 1.8 per cent after a two-day rally.

Ether sank as much as 3.3 per cent, while other so-called altcoins like Cardano and Solana dipped lower. Dogecoin sank as much as 3.8 per cent, a reversal from the prior session when the coin gain as much as 9.5 per cent.

Tesla CEO Elon Musk, an ardent supporter of the token, revived his $44bn bid for Twitter on Tuesday.

Economic data showed better-than-estimated growth for US service providers as well as companies’ strong demand for workers. Those figures could weigh on investors’ hopes for a more dovish Federal Reserve.

Stephane Ouellette, chief executive of FRNT Financial, a crypto brokerage firm, said that even though Bitcoin and the S&P 500 are both declining, Bitcoin’s move is relatively more muted.

“Typically BTC volatility is at least 3-4x higher than SPX volatility,” Ouellette wrote to Bloomberg News. Bitcoin’s drop is “the equivalent of a much smaller move in equities,” he added.

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