The price of Bitcoin continues to grind slowly to the downside while other major digital assets follow. The market is moving in tandem with the legacy financial sector, pricing in a higher terminal rate for 2023. 

As of this writing, Bitcoin trades at $16,600 with sideways movement in the last 24 hours. In the previous week, the cryptocurrency is recording a 3% loss. Previous outperformers, such as Dogecoin, Polygon, and Ethereum, are seeing heavy losses on similar timeframes. 

Bitcoin Likely To Bounce Back In The Coming Days?

The number one crypto is trending to the downside after the U.S. Federal Reserve (Fed) Chairman Jerome Powell spoke about the current macroeconomic conditions. During last week’s Federal Open Market Committee, the Fed Chair highlighted his objective to continue fighting inflation. 

This decision might lead to lower interest rates in the short term, but the Fed targets a higher terminal rate, the percentage at which the institution will finally pivot, in the long term. The market is reacting to this new reality. 

According to several reports, market participants were expecting a terminal rate of around 5%, which increased to 5.5%. Interest rates could remain this high until 2024. Several Fed representatives echoed the same hawkish message. New York Fed President John Williams said:

(…) we’re going to have to do what’s necessary” to get inflation back to the…