Bitcoin Loses Momentum as FOMC Looms

Bitcoin (BTC) traded near $80,000 during the U.S. session on Monday (October 26), following a dip toward the $79,000 level. Downward pressure persists after BTC recorded a weekly decline of approximately 3.6%, while Ethereum (ETH) hovered around $2,300 and Solana (SOL) near $100. XRP also remained around $1.30. These movements suggest that investors are maintaining a defensive stance ahead of major macroeconomic events this week.

The pressure on Bitcoin stems not only from technical factors but also from shifts in institutional capital flows. Spot Bitcoin ETFs saw significant inflows between October 19 and 21, only to reverse into outflows on October 22–23. Overall, Bitcoin ETFs still recorded a net inflow of approximately $301.2 million for the week, but this reversal indicates that investors are becoming more cautious.

Risk sentiment has also been affected by a sell-off in U.S. technology stocks and concerns regarding the scale of investments in artificial intelligence (AI). As tech stocks face pressure, Bitcoin has lost momentum, reflecting the asset class's continued sensitivity to shifts in appetite for risk-on assets. In the derivatives market, open interest in Bitcoin futures remains above early-week levels, with long-position liquidations dominating—a setup that could lead to heightened volatility during sharp price movements.

The primary focus is now the Federal Open Market Committee (FOMC) meeting on Wednesday. The market anticipates that the Federal Reserve will hold interest rates steady at 3.75%–4%, shifting attention toward the policy statement and commentary from the Fed Chair. A more hawkish stance from the Fed could strengthen bond yields and the U.S. dollar, putting downward pressure on Bitcoin and altcoins. Conversely, a more dovish signal could provide room for a rebound in crypto assets.

Beyond the Fed, U.S. GDP and Personal Consumption Expenditures (PCE) data, due on Thursday, serve as the next potential catalysts. PCE is highly significant as it serves as an inflation indicator closely monitored by the Federal Reserve. Currently, the US$80,000 mark acts as a key psychological level for BTC, while ETH and SOL continue to face relatively greater pressure. Until Bitcoin can stabilize back above the US$81,800–US$82,000 range, the crypto market will remain in a consolidation phase, characterized by the risk of high volatility.

Newsmaker Analysis: Bitcoin remains under pressure around the US$80,000 level as investors adopt a defensive stance ahead of the Federal Reserve’s upcoming decision, PCE inflation data, and earnings reports from major U.S. technology companies. A primary risk stems from a potential "hawkish" stance by the Fed, which could strengthen the U.S. dollar and bond yields, thereby putting downward pressure on risk assets like BTC and altcoins. Conversely, should the Fed signal a more "dovish" approach, the potential for a crypto rebound could re-emerge. For now, the US$80,000 level remains a critical psychological threshold for the market to watch.

Source: Newsmaker.id