FOMC Week Begins: BTC Rebounds as Rate Hike Risks Get Priced In

On September 14 (Monday), global markets entered a major central-bank week. Elevated U.S. inflation and oil prices have pushed market expectations for a Federal Reserve rate hike this week to 86%, while the U.S. dollar and Treasury yields remain strong, keeping risk assets under pressure.

BTC, however, has avoided further downside and stabilized in the $76,000-$78,000 range, suggesting that part of the hawkish outlook may already be priced in. As the FOMC meeting approaches, market attention is shifting from “whether the Fed will hike” to “whether tightening will continue after the hike.”

Oil Keeps Rising as Rate-Hike Odds Jump to 86%

U.S. core CPI rose 0.3% month over month in August, above market expectations. Combined with continued gains in oil prices, this has pushed the market-implied probability of a Fed rate hike this week above 86%. Meanwhile, the 10-year U.S. Treasury yield is approaching 5%, while the U.S. Dollar Index has risen 0.3% to 99.40, adding pressure to risk assets.

U.S. stocks ended a four-session losing streak last Friday, with the Dow up 0.98%, the Nasdaq gaining 0.96%, and the S&P 500 rising 0.86%. However, all three major indexes still closed lower for the week, indicating that risk appetite has yet to fully recover.

During Monday’s Asian session, U.S. equity futures weakened again. S&P 500 futures fell 0.6%, while Nasdaq 100 futures dropped 1.5%, with technology stocks facing greater pressure. Asian tech shares also declined amid renewed AI safety concerns. South Korea’s KOSPI closed down 3%, SK Hynix fell 6%, and Samsung Electronics lost 4%.

Oil remains the biggest macro variable. Rising risks to Middle East shipping routes and energy infrastructure pushed Brent crude back toward $107, while WTI climbed to around $103, with both gaining nearly 3% intraday. Although Trump again urged the Fed to keep rates low, persistent inflation and elevated oil prices are strengthening the case for a rate hike.

The key question this week is no longer simply whether the Fed will hike, but whether it signals that further hikes may follow. If Warsh emphasizes sticky inflation and energy-price risks, the dollar and Treasury yields could remain strong. If the message is closer to “hike once, then wait,” risk assets could see a short-term recovery.

BTC Holds $77K as Markets Price In Hawkish Expectations

On September 14, BTCC market data showed BTC trading at $77,711, up 0.70% over the past 24 hours. BTC had briefly fallen below $77,000 but quickly recovered, suggesting that part of the hawkish outlook has already been absorbed by the market.

On-chain analysis shows that Bitcoin open interest has fallen 13.5% from the level seen when BTC broke above $81,000 on September 3, while BTC itself has declined around 5% over the same period. This suggests that the market may have reduced leverage ahead of the FOMC rather than experienced a forced-liquidation-driven selloff.

Technically, $76,500-$77,000 remains the key support zone. As long as this area holds, BTC still has room for a gradual recovery. Resistance sits at $78,500-$79,000. A move back above this range would be needed before BTC can retest $80,000. If $76,500 breaks, the market may need to watch for a pullback toward $75,000.

Overall, the current move looks more like stabilization after hawkish expectations were heavily priced in than a trend reversal. Ahead of the FOMC decision, BTC is likely to remain range-bound. If the rate hike is delivered, crypto volatility could increase in the short term. If the Fed’s language is less hawkish than expected, BTC could see a recovery window.

ETF Flows Enter a Divergence Phase

ETF flows have begun to diverge. U.S. spot Bitcoin ETFs recorded approximately $463 million in net outflows last week, ending a three-week streak of net inflows and signaling weaker institutional demand for BTC.

In contrast, spot ETH ETFs still recorded around $197 million in net inflows over the same period, extending their positive streak to a fourth consecutive week. The shift in flows from BTC toward ETH has been an important reason for ETH’s relative resilience.

ETH is currently consolidating around $2,500. Resistance is seen at $2,550-$2,600, while support sits at $2,480 and the $2,400-$2,450 range. As long as ETF inflows continue, ETH may remain relatively stronger than BTC.

Central Bank Super Week Puts FOMC in Focus

Global markets enter a major central-bank week. The Federal Reserve will hold its policy meeting on September 15-16 and announce its rate decision at 2:00 p.m. on Wednesday, September 16. Chair Warsh will then hold a monetary policy press conference.

The Bank of England and Bank of Japan will also announce policy decisions on Thursday and Friday, respectively. In addition, the U.S. Senate will hold a key procedural vote on the CLARITY Act on Tuesday local time, while the SEC will hold a roundtable on 24-hour trading the same day. Regulatory developments could become another important driver for the crypto market this week.

Trading Watch

The market currently looks more like a defensive stabilization ahead of the FOMC than a trend reversal. With rate-hike expectations already elevated, the Fed’s guidance on the future policy path will likely determine the next major move.

If the Fed remains hawkish, the dollar and Treasury yields could stay firm, keeping pressure on risk assets. If the message is softer than markets expect, BTC could see a short-term recovery.

Risk Warning: Some of the views in this article are drawn from public media sources and are for reference only. They do not constitute any investment advice or trading recommendation. Markets involve risks, and trading should be approached with caution. Please ensure you have appropriate risk controls in place.