Bitcoin (BTC) circled $30,000 on May 18 after fresh comments from the United States Federal Reserve sparked n volatility.

Analyst: Extra Fed rate hikes “biggest risk”

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD consolidating within a range in place since May 12.

The pair had come unstuck as Fed Chair Jerome Powell delivered economic policy insights during the Wall Street Journal’s Future of Everything Festival.

“I don’t know if financial conditions have tightened more than this in a very long time,” he told the paper’s chief economics correspondent, Nick Timiraos, in an interview. 

Powell appeared to confirm that 50-basis-point key interest rate hikes would continue in subsequent meetings of the Fed’s Federal Open Markets Committee (FOMC) and could reach “neutral” levels in Q4. Hikes afterward, however, could nonetheless continue if necessary to tame inflation further.

With traditional markets already pricing in such a scenario, volatility overall was limited as Powell avoided surprises.

BTC/USD saw a brief drop to $29,500 before recovering during Powell’s words.

With risk assets set for difficult times as financial tightening continues, however, crypto market commentators had little by way of highly bullish news.

“Hawkish reminder. This is the biggest risk for markets,” macro analyst Alex Krueger responded in a series of Twitter posts on the potential for ongoing rate hikes into next year:

“Every Fed official has a different view of what ‘neutral’ is. Estimates are in the 2% to 3% range. Futures markets have now 3.25% priced in by December.”

According to CME Group’s FedWatch Tool, markets expect the target rate to be between 275 and 300 basis points at the FOMC’s December meeting.