- As the FOMC meeting approaches, the BTC price fails to create the necessary volatility. The price continues to trade within the range of $29,400 and $29,000.
- On-chain activity is increasing significantly, with the monthly average of new wallets surpassing the annual average. This indicates that the network fundamentals are improving and usage is increasing.
- Bitcoin’s correlation with the S&P500 Index has dropped to only 3%, demonstrating that the asset is becoming increasingly independent from traditional finance.
Hours remain until the critical interest rate decision meeting of the FED; What are the expectations? What can Bitcoin investors expect from this meeting?
Little Time Left for the FED’s Interest Rate Decision
In recent times, the price of Bitcoin has fallen below the levels of several weekly trading ranges, indicating that buyers may experience further losses in the coming days. After sustaining a steep downward trend since the early hours, the BTC price is currently recording some marginal gains. Other altcoins continue to trade under bearish pressure, suggesting that a market reversal may be imminent.
Furthermore, as the FOMC meeting approaches, the BTC price fails to create the necessary volatility. The price continues to trade within the range of $29,400 and $29,000, remaining stagnant for several days. Now that the meeting is approaching, some BTC candles may form around the price, indicating the end of the current correction.
The FED will announce its interest rate decision today at 9:00 PM (18:00 UTC) Turkish time. Many experts believe that approximately 98% of the market expects a 25 basis point increase. Therefore, while no significant price change is expected, a notable decline may be triggered if FED Chairman Jerome Powell says something unexpected by the market.
According to popular analyst Michael van de Poppe, the price of Bitcoin could drop to around $28,500, reaching new monthly lows. This decline is believed to be caused not only by the FOMC meeting but also by the GDP and PCE. However, it indicates a possible bullish reversal after testing low levels, which could push the price back above $30,000.
In addition, on-chain activity is increasing significantly, with the monthly average of new wallets surpassing the annual average. This indicates that the network fundamentals are improving and usage is increasing. Although on-chain activity has contracted to some extent, it has started to expand again, indicating the presence of room for a bullish reversal.
Bitcoin’s Correlation with S&P500 is Declining
According to crypto market data provider Kaiko, Bitcoin’s correlation with the S&P500 Index has dropped to only 3%, indicating that the asset is becoming increasingly independent from traditional finance.
Some experts have argued that such a development over the years could serve as a catalyst to take BTC’s price to a new all-time high. According to data revealed by Kaiko, the correlation between Bitcoin and the S&P500 Index was last at 3% in August 2021.
Notably, the correlation was around 50% at the beginning of 2023 and above 35% about a month ago. Since the beginning of the year, the S&P500 Index has risen by over 18% due to the increase in the prices of leading companies such as Apple, Tesla, and Amazon. However, Bitcoin has significantly outperformed, increasing its value against USD by over 75% since the beginning of 2023.
