• Bitcoin price has recently lacked direction, leaving traders guessing its next move. 
  • With the Federal Reserve’s interest-rate decision scheduled to take place on July 26, volatility could make a comeback.
  • With disinflation on the rise, the Fed might even opt for rate cuts by year-end, which could improve the crypto market narrative. 

Bitcoin price remains rangebound around the $30,000 psychological level. With volatility out of the picture, things are starting to get boring for crypto traders. However, the United States Federal Reserve (Fed) is set to make a decision on the interest rates, an event that  could reintroduce volatility and give BTC a directional bias.

Also read: El Salvador's bonds surge 62% amid Bitcoin's ETF-driven rally

Fed’s decision looks crucial for Bitcoin  

In the last Federal Open Market Committee (FOMC) meeting, The Fed signaled the possibility of two additional rate hikes by the end of the year. While the latest release of the Consumer Price Index (CPI) was relatively calm for crypto markets, the interest-rate decision set to take place on July 26 is likely to trigger a spurt of volatility.

The CME Group FedWatch tool shows a 99.8% probability of a 25 basis point interest-rate hike. 

CME FedWatch tool 

CME FedWatch tool 

While this hike might put a short-term strain on risk-on assets, it could also be a pivotal moment that kickstarts a rally for Bitcoin price. Many experts say that the Fed’s interest rate hike in July might be the last one of the current cycle. Following this, there might be a pause that leads to rate cuts, especially considering that the inflation rate, as measured by the Consumer Price Index (CPI), has dropped from a peak of 9.1% to 3.0%. 

Goldman Sachs has reduced the recession forecast for the US economy to 20%, partially due to the decline in inflation. Combining this macroeconomic development with a potential approval of a Bitcoin spot ETF, the crypto market outlook does look bullish. 

Read more: Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Last recourse for BTC and ETH, but XRP will not yield

Bitcoin price and its short-term outlook

Bitcoin price has swept liquidity, resting below equal lows at $29,500, and is ready to rally to $30,861. This move would likely attract greedy bulls before smart money pushes BTC lower.

The target for the short-term downtrend would include the $28,138 level, which is the midpoint of the 27% rally seen between June 15 and 23. In certain cases, BTC could drop to $27,330 and $26,767 levels, both of which are key accumulation levels for long-term holders. 

If the macroeconomic outlook improves as described above, Bitcoin price could bounce from the key support areas and hit $35,000 and $41,000 levels.

BTC/USDT 4-hour chart

BTC/USDT 4-hour chart

On the other hand, if the descent pushes Bitcoin price beyond the $25,000 level, it would shake investor confidence. This move would produce a lower low and invalidate the bullish thesis, potentially triggering a correction to the key support level at $21,313.

Read more: Bitcoin spot ETF approval by SEC is a potential game changer for BTC price


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended Content

Editors’ Picks

Is Altcoin Season here as Bitcoin reaches a new all-time high?

Is Altcoin Season here as Bitcoin reaches a new all-time high?

Bitcoin reaches a new all-time high of $98,384 on Thursday, with altcoins following the suit. Reports highlight that the recent surge in altcoins was fueled by the victory of crypto-friendly candidate Donal Trump in the US presidential election.

More Altcoin News
Shanghai court confirms legal recognition of crypto ownership

Shanghai court confirms legal recognition of crypto ownership

A Shanghai court has confirmed that owning digital assets, including Bitcoin, is legal under Chinese law. Judge Sun Jie of the Shanghai Songjiang People’s Court shared this opinion through the WeChat account of the Shanghai High People’s Court.

More Cryptocurrencies News
BTC hits an all-time high above $97,850, inches away from the $100K mark

BTC hits an all-time high above $97,850, inches away from the $100K mark

Bitcoin hit a new all-time high of $97,852 on Thursday, and the technical outlook suggests a possible continuation of the rally to $100,000. BTC futures have surged past the $100,000 price mark on Deribit, and Lookonchain data shows whales are accumulating.

More Bitcoin News
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange

Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange

Shiba Inu trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.

More Shiba Inu News
Bitcoin: New high of $100K or correction to $78K?

Bitcoin: New high of $100K or correction to $78K?

Bitcoin surged to a new all-time high of $93,265 in the first half of the week, followed by a slight decline in the latter half. Reports highlight that Bitcoin’s current level is still not overvalued and could target levels above $100,000 in the coming weeks.

Read full analysis
Best Forex Brokers with Low Spreads

Best Forex Brokers with Low Spreads

VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.

Read More

BTC

ETH

XRP