Key takeaways:
- Odds of a Fed rate cut this week have fallen below 3%, according to Polymarket.
- Bitcoin could drop to $112,000 if critical support levels fail to hold.
Bitcoin held steady at $118,200 on Wednesday, as traders remained cautious amid rising macroeconomic uncertainty.
There’s a 97% probability that interest rates will remain unchanged.
The U.S. Federal Open Market Committee (FOMC) began its two-day meeting on Tuesday, with a decision on interest rates scheduled for Wednesday at 2:00 p.m. ET.
Despite pressure from former President Donald Trump to lower rates, markets widely expect the Federal Reserve to hold rates steady. According to Polymarket, there’s a 97.5% chance that rates will remain between 4.25% and 4.50%, and only a 2.3% probability of a 0.25% rate cut.
A widely held market view is that any bearish reaction to unchanged interest rates has already been priced in.
According to crypto investor TedPillows, traders seemed to “panic sell” on Tuesday amid growing uncertainty over what Fed Chair Jerome Powell might say after the meeting.
“People likely dumped their bags out of fear, but they’ll probably end up FOMO buying at higher prices once the Fed speaks,” he said, noting that this familiar pattern has often preceded strong market moves in August.
“Then August hits, everything goes parabolic. And the sidelined traders? They end up chasing, again.”
As a result, markets will be closely analyzing Powell’s tone during the FOMC press conference for any signs of a shift in stance.
“Investors will be listening very carefully to the Fed chair, and a dovish posture can influence the market,” market commentator James DePorre posted on X Wednesday.
“The rate cut matters, but Powell’s words at the press conference are even more important,” OptionsTrading101 told followers in a post on Tuesday.
Traders are also keeping an eye on Friday’s U.S. nonfarm payrolls report, along with upcoming Trump tariff deadlines and their potential impact on the crypto market.
What’s next for Bitcoin price?
At the moment, $120,000 is the key resistance level traders are closely watching for Bitcoin. Several analysts believe that a strong move above this threshold could trigger a rapid rally toward new all-time highs.
“A confirmed breakout beyond this zone could shift market dynamics, bringing the $141K region into focus,” Glassnode noted in its latest Week Onchain report.
The $141,000 target aligns with two standard deviations above the Short-Term Holder (STH) realized price, as illustrated in the chart below.
Glassnode added:
“This is an area where key onchain metrics suggest profit-taking could sharply intensify.”
Another important level to monitor is $125,000, which represents the Short-Term Holder (STH) cost basis pushed one standard deviation higher.
On the downside, traders are watching Bitcoin’s STH cost basis at $105,400, along with the yearly open near $93,000—both key support levels. Notably, $93,000 also aligns with the STH cost basis adjusted one standard deviation lower.
A chart shared by popular analyst Killa highlights the $114,000–$116,000 zone as a critical area of interest. According to Killa, Bitcoin could briefly dip below this range to fill a fair value gap down to $112,000 before potentially rebounding.
Similarly, anonymous Bitcoin analyst SuperBitcoinBro noted that BTC could dip as low as $112,000 before staging a “squeeze higher,” with the next major liquidity cluster positioned between $119,800 and $121,000.
Nebraskangooner, another Bitcoin analyst, said that the BTC price will remain in range “until Powell speaks to make a big move.”
