Traders split on whether Fed decision triggers rally or decline
Bitcoin hovered near $65,000 on Tuesday ahead of a Federal Reserve meeting scheduled for 2pm Eastern time on June 17, with prominent traders divided on whether the FOMC announcement will spark a bullish or bearish reaction.
The cryptocurrency fell below $65,000 on Wednesday, hitting an intraday low of $64,782 on Bitstamp. Bitcoin trader Killa flagged $64,000 as a critical support level, warning that failure to maintain it could trigger a sharper decline.
“We need to maintain bullish market structure from here (64K). If not, there’s a strong chance we revisit the $60K lows after this pivot,” Killa said. The trader added that the FOMC outcome carries outsized weight for near-term price direction: “FOMC could set the tone for the rest of the month.”
Killa’s base case rests on historical precedent. “If recent history is any indication, we have generated far more bearish reactions than bullish ones,” the trader noted. That contrasts with current market positioning. “Right now, BTC is forming a bullish narrative into the event, but as I always say, the outcome is usually priced in before the news is released,” Killa said.
The FOMC meeting takes place under new Federal Reserve chair Kevin Warsh, whose remarks at the post-decision press conference are expected to carry weight equal to the policy outcome itself. Warsh has faced pressure to cut rates despite inflationary effects from the US-Iran war.
Not all traders expect a decline. Niels, cofounder of marketing agency STABL, predicted a short-term bounce but saw longer-term weakness. “FOMC meeting is happening today, exactly when the US-Iran peace deal is very close. IMO, Bitcoin could show some strength but eventually it’s going to $55,000,” Niels said. Cryptic Trades, an analytics account, took a more constructive view, suggesting that “after this pullback, the next big leg up is coming.”
Bitcoin has historically weakened around Fed decisions. On Tuesday, the cryptocurrency lost momentum even as stocks climbed on Iran relief, underscoring the divergence between macro sentiment and crypto price action.
The range of trader predictions reflects genuine uncertainty. Killa’s downside target sits at $60,000, while Niels projects a move to $55,000 over a longer horizon. Bitcoin approached $67,000 earlier in the week before the pullback accelerated.
