Bitcoin Faces FOMC Test as Past Meetings Trigger Heavy Selling

Bitcoin remains range-bound below $90,000, hovering near a one-month low, as investors remain cautious ahead of the Federal Reserve policy meeting.

Market attention has shifted to the Federal Reserve’s two-day meeting, which ends Wednesday, and policymakers are expected to keep interest rates unchanged.

Even though a pause is largely priced in, traders are closely examining the Fed’s statement and Chairman Jerome Powell’s news conference for clues on the timing of possible rate cuts and the central bank’s inflation outlook.

Any change in tone from Powell could influence overall risk sentiment and liquidity.

How Bitcoin ($BTC) is likely to react to the FOMC meeting: lessons from past cycles

The Federal Open Market Committee (FOMC) plays a critical role in shaping global financial markets by setting U.S. monetary policy.

With eight meetings scheduled each year, its decisions on interest rates directly influence liquidity, risk appetite and capital flows between assets, including Bitcoin.

As markets eagerly await the conclusion of the first FOMC meeting on Wednesday, expectations for a January rate cut remain extremely low, at just 2.8%. This suggests that monetary easing is unlikely in the near term, keeping financial conditions relatively tight.

Historical data from 2025 provides important context for how Bitcoin tends to react to these events. Out of eight FOMC meetings, The price of Bitcoin declined after seven, with only one producing a short-lived rally.

The declines were often sharp, ranging from –6% to –29%, while BTC only rebounded in May, rising +15% before the momentum faded.

HOW DOES BITCOIN $BTC WILL REACT TO THE FOMC MEETING, LAST TIME IT FALLED BY -9%

The Federal Open Market Committee (FOMC) is responsible for setting U.S. monetary policy and meets eight times a year to decide on interest rates that shape liquidity conditions in global markets.

Look… pic.twitter.com/YBVr0fBXxn

– Ali Charts (@alicharts) January 27, 2026

One of the key takeaways from historical data is that FOMC weeks have consistently brought increased volatility and downside risk to BTC prices. While markets often rally before meetings in hopes of dovish signals, the reaction after the announcement has been bearish in most cases.

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