What to expect with low volatility, FOMC

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Crypto News: Cryptocurrency market ecosystem anticipates outcome of July 26, 2023 Federal Reserve interest rate meeting. Traders are expecting the Federal Open Market Committee (FOMC) to raise the target rate another 25 basis points in what could be the last of the current cycle’s rate hikes. Meanwhile, Bitcoin price is poised for the next bullish wave cycle as it has found support in the crucial area.

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According to the CME FedWatch Tool, a platform that gauges the likelihood of the Fed changing the target rate at the next meeting, the market is fully confident that there will be a 25 basis point hike from the current target rate of 500-525 basis points. No less than 99.2% of respondents believe that the US central bank will impose an interest rate hike at the July meeting.

What Low Volatility Means for Bitcoin Price

Currently, the volatility of major cryptocurrencies is at a six-month low, thanks to the recent sideways movement surrounding news of financial giants like Blackrock filing spot Bitcoin ETFs with the United States Securities and Exchange Commission (SEC). Data from Glassnode shows that the last time Bitcoin price experienced such a contraction in volatility was in January 2023, when the price of the crypto market surged, with Bitcoin itself recording a 30% rally. Also, historically, these tight compressions of the sideways move have generally followed an uptrend thereafter.

Bloomberg analysts have noted that these situations generally act as precursors to a breakout move given the cyclical nature of volatility. Earlier, Goldman Sachs analysts predicted that the July 2023 Fed meeting could see the last of the rate hikes in the current monetary tightening cycle. Therefore, any hint of relief in US Fed Chairman Jerome Powells’ press conference after the FOMC press conference could bring Bitcoin price closer to the next resistance level, which is near the $33,000 mark.

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