BTC Holds Below $76K Ahead of FOMC Decision as Experts Rule Out Dovish Policy Shift
Bitcoin trades beneath the $76,000 threshold as the Federal Reserve prepares to announce its interest-rate decision, with analysts forecasting continued policy tightening despite President Donald Trump's vocal calls for rate reductions.
Bitcoin (BTC) remained anchored near its monthly lows during Wednesday's opening session on Wall Street as investors turned their attention to the upcoming US Federal Reserve announcement on interest rates.
Key points:
- Bitcoin maintained trading levels beneath the $76,000 mark leading into the Federal Reserve's interest-rate announcement. The cryptocurrency hovers near its weakest position since Aug. 21.
- Market pricing indicated approximately 93% probability that the Fed will implement a 0.25% rate increase, which would push the federal funds rate to the 3.75-4% range.
- On-chain analysis revealed strengthening support at the $68,000 level as purchasing liquidity migrated closer to current spot pricing.
Probability of Fed Rate Increase Exceeds 90% Amid Trump's Rate-Cut Appeals
Information from TradingView indicated BTC/USD exchanging hands beneath the $76,000 level following the establishment of fresh September lows at $74,960 during the previous trading session.
The price deterioration coincided with the CLARITY Act's inability to secure sufficient Senate votes for proceeding to the debate phase, coming up short of the necessary 60 votes. Focus has subsequently shifted to the Fed, which finds itself navigating a delicate balance between controlling inflationary pressures and addressing US president Donald Trump's persistent calls for monetary easing through rate cuts.
The most recent figures from CME Group's FedWatch Tool indicated that the probability of officials approving a 0.25% rate increase exceeded 90% at the time of writing, which would elevate the federal funds rate to the 3.75-4% target range.
Providing commentary, trading resource The Kobeissi Letter observed that such elevated odds render a rate hike virtually inevitable.
In data going back to 2008, whenever expectations of a hike have been this high, the Fed has invariably delivered one. If the Fed decided to leave interest rates unchanged today, it would mark the biggest dovish surprise at a scheduled policy meeting since 1994.
This particular meeting represents one of three monetary policy decisions from central banks scheduled for this month. The European Central Bank implemented a 0.25% rate increase during the previous week, while the Bank of Japan is anticipated to follow suit during its Friday session, which would bring its benchmark rate to 1.25%, representing its most elevated level in 31 years.
Central banking institutions across the globe are confronting escalating inflationary pressures as petroleum supply chains grapple with the consequences of an expanding military conflict in the Middle East. US WTI crude oil reached $106.70 per barrel during Tuesday's session, marking its most elevated level since May 4.
As previously documented by Cointelegraph, escalating oil prices have generated a significant ripple effect on US Consumer Price Index (CPI) inflation metrics.
BTC Price Support Levels Cluster Near $70,000 Mark
In examining near-term BTC price dynamics, on-chain analytics platform Glassnode evaluated potential downside targets should BTC/USD break below its established local trading range, which has remained intact since Aug. 21.
Resting bids, the buy orders waiting in the book, have pulled in toward price. Nearly two thirds of the bids resting within 20% of price now sit between 1% and 10% below it, up from about half at the start of the year.
Glassnode, The Week Onchain
Exchange order-book purchasing liquidity identifies $68,000 as the subsequent support threshold. Current pricing rests marginally beneath the True Market Mean, which represents the collective cost basis of the presently active BTC supply. The collective cost basis of short-term holders, characterized as wallets maintaining an unspent transaction output (UTXO) for periods under six months, establishes an additional potential support zone at $71,300.
If the range breaks and those bids are used up, the next floor is the on-chain one at $62K to $65K, where the heaviest block of supply below the market was last bought.
Glassnode