Bitcoin and cryptocurrency prices have been under pressure in 2022 with traders feeling the fallout from a number of major collapses in the industry.
Selim Korkutata | Anadolu Agency | Getty Images
Bitcoin briefly rose above $23,000, following stocks higher after the U.S. Federal Reserve raised interest rates but suggested the pace of hikes could slow.
Cryptocurrencies have been quite correlated to U.S. stocks, in particular the Nasdaq, which on Wednesday jumped 4%.
Bitcoin traded at $23,239.03 at around 9:38 a.m. ET on Thursday, up about 1.7%, according to data from CoinMetrics. Later, Bitcoin retreated slightly to trade around 0.51% higher at $22,876.00.
Other digital coins rose, too. Ether was about 2.4% higher at $1,626.73, CoinMetrics found.
On Wednesday, the Fed raised its benchmark interest rate by 0.75 percentage points as its looks to fight rampant inflation without tipping the economy into recession. But the central bank's chair Jerome Powell suggested that the pace of rate rises could slow, which sparked an equity rally on Wednesday which has fed through to European and Asian trading on Thursday.
"The conclusion of Wednesday's Fed meeting opens up a summer window for a Bitcoin relief rally, given we now have two months until policymakers next deliberate on monetary policy," Antoni Trenchev, co-founder of cryptocurrency wallet Nexo, said in a research note.
Bitcoin is attempting to stage a sustained rally after several failed attempts this month. The world's largest cryptocurrency has been trading within a range of between $20,000 to just over $24,000 since mid-June after a brutal crash this year wiped off 50% of its value.
"The next 24 hours will be a true test of Bitcoin's re-discovered resilience after it shrugged its shoulders at this month's stellar U.S. inflation data and didn't wince when Tesla announced it has sold most of its BTC (bitcoin) holdings," Trenchev said.
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