FOMC Rate Decision Approaches: Bitcoin Key Levels and Market Scenarios

#Introduction

With the FOMC meeting approaching, the cryptocurrency market has entered a sensitive window. Bitcoin is oscillating around $64,000, while Ethereum is showing relative strength. This article outlines possible rate decision scenarios, key timing, and BTC/ETH technical and fund flow signals.

#Why the FOMC Decision Matters

The FOMC meeting is the main venue where the Federal Reserve decides the federal funds rate, and its decision and the Chair's subsequent press conference often drive market volatility. The current federal funds rate is 3.75%. Based on market expectations, the probability of holding rates unchanged at this meeting is around 70%, the probability of a hike is about 30%, and the chance of a cut to 3.5% is only about 1%.

Holding rates unchanged: The market will likely trade sideways in the current range, waiting for subsequent data and news catalysts.
Unexpected rate cut: This is clearly positive for risk assets, and cryptocurrencies could rally quickly.
Rate hike: Market sentiment may turn pessimistic, and crypto asset prices could face downward pressure.

Trump has publicly called for rate cuts, but the Fed Chair usually maintains independence and is not necessarily swayed by political remarks. Similar situations occurred multiple times during Powell's tenure, and current Chair Kevin Warsh is expected to base decisions on data as well.

#Decision Time and Wording to Watch

The FOMC decision will be announced at 11:30 PM India time and midnight Bangladesh time. The Fed Chair's press conference will then begin at midnight.

Besides the rate number, the Chair's wording is equally critical. If it suggests that inflation may heat up in the future and does not rule out rate hikes, the market could come under pressure; if it sends a more positive signal that inflation is easing, the market may find support.

Note that there is no FOMC meeting in August; the next meeting is in September, followed by October and December. Therefore, CPI, labor market, and other data released in August will directly affect market expectations for rate hikes at subsequent meetings.

#Bitcoin's Current Trend and Key Technical Levels

At the time of recording, Bitcoin is trading near $64,300–$64,400. The previous day saw violent capital inflows and outflows, with the price dropping quickly from $65,600–$65,800 to around $62,600 before rebounding slightly.

The short-term trend remains bearish; a daily close above $66,700 is needed to ease downward pressure. Main resistance above is concentrated in the $65,300–$65,800 area, with further resistance near $66,400.

During the FOMC event window, market manipulation risk is elevated, and sharp spikes in both directions often occur. If price first pulls back and stabilizes, the probability of an upward rebound after the decision may be higher; if price has already rallied above $65,000 before the decision, be wary of a post-decision pullback. Given the high uncertainty, short-term traders may consider staying on the sidelines and waiting for clearer confirmation signals.

#Ethereum's Relative Strength and Capital Flow Signals

Recently, Ethereum has been slightly stronger than Bitcoin. Fund flow data shows that Ethereum recorded about $9.4 million in net buying, while Bitcoin still faced about $49 million in net selling over the same period. The previous day, Bitcoin had about $11 million in net selling, and Ethereum also saw about $11 million in net inflows on the 27th.

If Bitcoin can reclaim $66,800, Ethereum is likely to see a notable recovery; conversely, if Ethereum breaks below its current key support, it could pull back again, providing long-term investors with opportunities to accumulate in batches.

#Position Ideas and Risk Disclaimer

In terms of allocation, Bitcoin can serve as the core of the portfolio, accounting for about 50%–60%; Ethereum around 30%. At this stage, it is advisable to remain cautious on most altcoins and wait for BTC/ETH trends to become clearer before considering them.

It must be emphasized that the cryptocurrency market carries high risk, and any action should be based on personal research. This article is for educational purposes only and does not constitute financial advice.