Bitcoin Price Braces For FOMC Volatility As History Shows Major Post‑Fed Sell‑Offs
The Bitcoin worth is beneath rising strain forward of Wednesday’s Federal Open Market Committee (FOMC) assembly, which has traditionally corresponded with large worth actions available in the market’s largest cryptocurrency.
Rate Cut Odds Fade
The Federal Reserve (Fed) is broadly anticipated to go away rates of interest unchanged at this assembly. Economists surveyed by monetary knowledge supplier FactSet anticipate the federal funds fee — the benchmark fee banks use for in a single day lending — will stay within the 3.5% to three.75% vary.
Such a pause would comply with three consecutive fee cuts delivered by the Fed towards the top of final 12 months, a shift that originally fueled optimism throughout danger belongings, together with the Bitcoin worth.
Despite that earlier momentum, the Bitcoin worth has struggled to keep up its footing. Ahead of the FOMC choice, the cryptocurrency is buying and selling close to $87,780, roughly 30% beneath the all‑time highs reached final 12 months.
Market analyst Ali Martinez has pointed to Bitcoin’s historic conduct round FOMC conferences as a cause for warning. In a current post on X (beforehand Twitter) Martinez highlighted that expectations for a January fee reduce are extraordinarily low, estimated at simply 2.8%, signaling that significant coverage easing is unlikely within the close to time period.
That backdrop, he argues, has typically set the stage for elevated volatility for the Bitcoin worth fairly than sustained upside. Looking again at 2025, Martinez famous that Bitcoin reacted negatively after the overwhelming majority of the Fed’s coverage conferences.
Of the eight FOMC decisions held through the 12 months, seven have been adopted by notable declines for the Bitcoin worth. The January assembly was adopted by a 27% drop, March noticed a 14% decline, June was down 8%, July slipped 6%, September fell 7%, October recorded a 29% pullback, and December ended with a 9% loss.
The analysts famous that the one exception seen within the 12 months got here in May, when the Bitcoin worth briefly rallied about 15% after the choice.
Bitcoin Price Approaches Key Decision Zone
From a technical and on‑chain perspective, analyst BitBull additionally sees the Bitcoin worth approaching a important second. BitBull noted on social media that the asset has entered what she describes as a key on‑chain choice zone.
At present ranges, the Bitcoin worth is buying and selling nearly precisely on the Active Investor Mean, estimated close to $87,500. This degree represents the typical price foundation for energetic patrons, inserting a lot of that capital at breakeven.
BitBull defined that strain is constructing on either side of the worth. Above present ranges, the brief‑time period holder price foundation sits close to $96,500, that means many current patrons are already underwater.
As a end result, any upward transfer towards that zone may face promoting strain as merchants look to exit at lowered losses. On the draw back, the True Market Mean at round $80,700 has traditionally marked the boundary between a “routine correction and deeper structural weak point.”
Further beneath, the realized worth close to $56,000 means that lengthy‑time period holders stay firmly in revenue and largely unshaken by current volatility.
BitBull argues if the Bitcoin worth can preserve assist above the $87,500 degree, it might point out that energetic capital is defending its place and that broader market power stays intact. A sustained break beneath that degree, nevertheless, may open the door for a transfer towards $80,700.
Featured picture from OpenArtwork, chart from TradingView.com
