Bitcoin Experiences Increased Volatility Ahead of 'Tricky' FOMC Meeting as $93.5K Yearly Open is Breached

Bitcoin retraced its recent gains on Wednesday as traders anticipated misleading movements surrounding the Federal Reserve's interest rate announcement.

Key Takeaways

Bitcoin struggled to maintain its surge past $94,500 as traders braced for the Fed’s interest rate decision.
There is an expectation of unpredictable price swings both ways around the FOMC meeting.
Japan's bond market is set to introduce additional volatility, posing as the next crucial issue for risk assets.

Bitcoin slipped from its recent peak above $94,500 as traders remained uncertain ahead of the Federal Reserve's interest rate decision. The crypto market is prepared for possible unreliable price moves on both sides of the Federal Open Market Committee (FOMC) announcement.

Bitcoin Experiences Increased Volatility Ahead of 'Tricky' FOMC Meeting as $93.5K Yearly Open is Breached

Bitcoin Price Trends Ignore Yearly Opening Value

Data from Cointelegraph Markets Pro and TradingView indicated that Bitcoin's price was trending downwards at the start of Wall Street trading.

BTC/USD One-Hour Chart. Source: Cointelegraph/TradingView

After reaching a high of $94,650 the previous day, Bitcoin (BTC/USD) couldn't sustain higher levels, particularly failing to maintain the 2025 yearly opening price. At the time of writing, the pair was trading around $92,000, with market players anticipating erratic price behavior around the upcoming rate announcement and press conference.

"FOMC meetings can be quite tricky," remarked cryptocurrency trader, analyst, and entrepreneur Michaël van de Poppe on X.

BTC/USDT Four-Hour Chart with RSI and Volume Data. Source: Michaël van de Poppe/X

Trader Daan Crypto Trades pointed out the absence of significant liquidity clusters on either side of the market after the recent price increase. He explained, “$BTC has eliminated that $93K-$94K liquidity cluster as mentioned yesterday. This was the most logical area to visit from a liquidity standpoint. With that removed, there’s no significant area nearby.”

BTC Liquidation Heatmap. Source: CoinGlass

As previously reported by Cointelegraph, there was a strong expectation that the Federal Open Market Committee (FOMC) would cut rates by 0.25%. However, the outlook for future policies remained somewhat uncertain, especially regarding Fed Chair Jerome Powell's comments.

"The rate decision is nearly fully integrated into the market price, but the real attention will be on Powell’s tone," trading firm QCP Capital shared in its latest "Asia Color" market update.

Fed Target Rate Probabilities for Dec. 10 FOMC Meeting (screenshot). Source: CME Group FedWatch Tool

Japan Emerging as a New Crypto Risk Factor

QCP noted that after the FOMC announcement, risk-asset traders would likely shift their focus to Japan, which is currently experiencing unusual circumstances in its bond market.

Cointelegraph also reported on recent trends showing Bitcoin retail inflows to Binance collapsed to a record low of 400 BTC in 2025.

"The BOJ meeting scheduled for December 19 has turned into a significant risk event," QCP commented. Volatility may arise from the bond market influencing the yen carry trade, a concern already observed in 2024, when cryptocurrency markets responded in real time to similar developments.

The Bank of Japan has indicated it might deviate from global trends by raising interest rates in the near future.