FOMC meeting’s impact on Bitcoin and crypto trading.

The Bitcoin and cryptocurrency market is facing a major event today with the Federal Open Market Committee (FOMC) meeting of the US Federal Reserve (Fed) at 2:00 pm EST. This is the most important event of the week and probably the entire month of June for the crypto market. The meeting will release the interest rate decision at 2:00 pm EST and the following press conference will be at 2:30 pm EST. It is expected that there will be a pause in the rate hike cycle since it started in March 2022. The CME FedWatch tool currently indicates a 95.3% probability that there will be no change at today’s meeting, which would give the central bank more time to observe the effects of its fight against inflation. The new “dot plot”, the Fed members’ projection of future interest rate path is also important, as any correction to the upside will likely drive equities down and the dollar index (DXY) up. Bitcoin and crypto are likely to follow this trend. The US bond market is currently pricing in another rate hike by the Federal Reserve and a rate cut by the end of 2023. However, it is likely to be more binary, either the Fed does not cut, or growth falls off so hard it is cutting a lot. The bond market is pricing in 200 basis points of rate cuts in 2024, which would mean the recession won’t hit until next year. The Bank of Canada (BoC) shows that the Fed could hike further after a pause. The probability of another quarter-point rate hike in July is 63%, according to the CME FedWatch Tool. The Bitcoin price is on thin ice and is facing stiff resistance between $26,000 and $28,250 where 5.18 million wallets bought 2.1 million BTC. At press time, the Bitcoin price remained relatively calm ahead of today’s interest rate decision.