Bitcoin fell below $65,000 on Wednesday, hitting an intraday low of $64,782 as markets braced for a key U.S. Federal Reserve policy decision. Attention centered on the Federal Open Market Committee (FOMC) meeting, the first chaired by Kevin Warsh, with traders closely watching both the rate decision and his remarks.
The Fed ultimately held interest rates steady in the 3.50% to 3.75% range, a move widely expected. Market pricing had indicated a 97% probability of no change. However, the central bank’s updated economic projections delivered a more hawkish outlook than anticipated, reshaping expectations for the months ahead.
Hawkish outlook shifts rate expectations
Policymakers revised their “dot plot” forecasts, removing the previously expected rate cut for 2026. This signals that borrowing costs may remain elevated for longer, tightening liquidity conditions through the end of the year.
Futures markets reacted quickly. Pricing shifted to reflect a 66% probability of at least one rate hike before year-end, marking a sharp reversal from earlier expectations of multiple rate cuts.
The policy stance comes amid a complex backdrop. A preliminary agreement to ease the U.S.–Iran conflict has weighed on oil prices, which slipped toward $75 a barrel. Despite this, the Fed appears more focused on persistent inflation, with May data showing consumer prices rising 4.2% year over year.
Key levels in focus as volatility builds
Market analysts highlighted $64,000 as a critical support level. A drop below this threshold could open the door to further downside, with targets as low as $60,000 or even $55,000 coming into play if weakness accelerates.
Analyst Killa noted that Bitcoin has often reacted negatively around FOMC events, adding that recent gains may have already priced in optimism ahead of the decision. The analyst warned that losing the $64,000 level could weaken the current market structure.
Niels, co-founder of STABL, echoed the cautious outlook, suggesting that any short-term rebound could be followed by a decline toward $55,000, particularly if broader sentiment deteriorates after the announcement.
Mixed signals as market structure holds
Not all views were bearish. Analytics account Cryptic Trades described the current move as a temporary pullback, pointing out that Bitcoin continues to hold its daily bull market support band. According to this perspective, upward momentum could resume once selling pressure fades.
Still, recent data points to fragility beneath the surface.
- Five consecutive weeks of outflows from crypto-related investment products
- $81 million in liquidations triggered by a modest 1.4% price drop
- A consistent pattern of declines following eight of the past nine FOMC meetings
Traders watch for confirmation
With Bitcoin hovering near key support, the coming days will be critical. A sustained move below $64,000 would reinforce bearish scenarios outlined by analysts, while holding above it could stabilize sentiment and open the door for recovery.
For now, traders remain focused on how markets digest the Fed’s hawkish stance and whether Bitcoin can withstand mounting macroeconomic pressure.
Worried about Fed decisions shaking Bitcoin? Learn how Fed rate moves influence BTC volatility and strengthen your trading strategy.
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