By Ambar Warrick
Investing.com– Bitcoin hit a three-week high on Wednesday, while Ethereum reached its highest level since the merge as growing expectations of dovish signals from the Federal Reserve weakened the dollar.
rose 4.6% to $20,201, trading above the $20,000 level for the first time in three weeks, while jumped 10.7% to a 1-½ month high of $1,485 by 22:27 ET (02:27 GMT).
Both token gains reflected a wider uptrend in the cryptocurrency market as the dollar fell. Coinmarketcap data indicates that the total crypto market cap is less than $30 Billion shy of the $1 Trillion mark.
Markets anticipate that the Fed will become more hawkish in response to a significant economic slowdown in the United States. The central bank is still expected to raise rates in November, but traders expect the bank to slow down its rate hikes in the month following.
Data on Tuesday showed that the previous month’s industrial activity fell. The reading that followed showed an extended contraction of U.S. industrial activities in September.
The dollar was affected by the prospect of a Fed less hawkish, with the greenback sliding for the last four sessions. Both the and traded at 111.11 on Wednesday, a level that was more than two weeks below their previous lows.
The weakness in the dollar helped crypto markets to break the tight trading range they had been experiencing for the past two months. However, it remains to see if the market can continue its uptrend, just like previous breakouts.
Markets were also encouraged when it was reported that many wealthy Asian investors were buying crypto, specifically Bitcoin.
The world’s largest cryptocurrency had last month risen as far as $22,700 before tumbling back to near annual lows. As the Fed tightened monetary policy, the token and wider crypto space suffered severe losses.
Despite the ongoing conflict with Securities and Exchange Commission (SEC), the main focus is also on regulatory updates in the crypto space.