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As the Federal Open Market Commission announces its May 7 policy decision, Bitcoin traders face a macro-driven inflection point that can define summer price action. Under Chairman Jerome Powell, the Fed can almost keep the Fed-Funds corridor between 4.25% and 4.50%; CME Group’s FedWatch tool allocates a 98.2% chance to an unchanged stance. However, this near certainty did not mask the political noise.
President Donald Trump and Treasury Secretary Scott Bessent publicly urged lowering borrowing costs, but Powell’s latest public remarks on April 16 constituted monetary policy because monetary policy is “in a to-do and observation mode”, adding that the labor market is “in a decent state”, but the expectation of the Fed’s “obligation” to maintain a certain rate of inflation and not reach a certain price, which is a constant level, a constant limit, an always-on price, and can make a level of price increase, and will certainly increase a certain price. In fact, central banks continue to prioritize price stability, even as leading indicators suggest cooling the economy and are likely to relax in the second half of the year.
FOMC preview Bitcoin
For Bitcoin, less debate is about whether the Fed will blink tomorrow, but more about how algorithmic liquidity and discretionary positioning react to the tone of Powell’s press conference. Crypto trader Josh Rager told his followers on X: “Chop Chop is expected to FOMC until tomorrow. Then look forward to volatility after the announcement of lowering the tax rate. A reversal occurred during Powell’s speech. Here is my current FOMC script.” Although Rager’s baseline assumes that interest rates are ultimately lowered, his near-term focus is on the intraday whip that would usually form a statement and a q&q&a window.
Related Readings
Astronomer (@astronomer_zero) provides a more probabilistic roadmap, highlighting that his trademark Fomc reversal model “always offer more than 85% of the chances for reversals. If the mechanic continues to play this month, it will mean we will see a lot of progress here or in the last week (PED).
However, he pointed out that the historical advantage may be blunted by pointing out that widespread quarterly uptrend in Bitcoin: “This means that this and/or the next FOMC meeting will have a weaker reversal effect in the case where I expect to be a strong upstream.”
In fact, he predicted: “I think the most likely situation (76% chance) is moving from here, and the FOMC reversal is completely ignored. The opportunity (24%) is indeed the shallower decline in the region we stopped.”
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Columbus (@Columbus0x) looks for microstructures to confirm. He cited the liquidated furnace heat map, expecting that “a wick below… is below an equal low point, and is also a region where the Hyblock highlights as a yellow area,” a region that matches the 0.382 fibonacci recovery rate.
If Powell rings hawkish tone, Columbus expects “below the 200-day SMA’s low/A retest range bias, bringing the CME gap between $91.8 and $92.4 – or even down to high prices in the 80s.
Momentum diagnosis adds a final layer. The cryptocurrency Titan observed that Bitcoin “is solidifying between last week’s highs and lows, waiting for tomorrow’s FOMC meeting and Jerome Powell’s speech. Meanwhile, the daily MACD is crossing bearish, and the signal sends a slower momentum.” The tumbling confirmed in the histogram will be consistent with the shallow back-like background outlined by astronomers and Columbus, but the merger itself makes higher time frame trends traders constructive traders
To sum up, tomorrow’s decision only appears on the surface. The real determinant is Powell’s forward-looking language and its impact on terminal rate pricing. If the chair emphasizes patience when confirming softer data, the curve may start discounting June cuts, providing a macro tailwind to confirm the Bulls’ quarterly paper.
Instead, any updates to inflation will make short-term bears hunt liquidity below $92k. Either way, the tape has little room for complacency: the liquidity is thin, and the choice gamma gathers around the $100,000 strike of psychological resonance, and the narrative energy surrounding the second half-2025 easing cycle is colliding with the Fed’s recent inflation authorization.
At press time, BTC traded at $94,097.
Featured images from Shutterstock, charts from TradingView.com
