Bitcoin Holds Near $105K as Fed Stands Pat – Bullish Pause or Impending Drop?

Bitcoin's price action flatlines just shy of $105,000 as the Federal Reserve maintains its holding pattern. Is this the calm before another leg up—or a warning sign for traders?

The Fed Factor: With interest rates frozen yet again, crypto markets get neither the sugar rush of cuts nor the cold shower of hikes. Just another day in monetary purgatory.

Technical Crossroads: The $105K level now acts as both magnet and barrier. Bulls see consolidation; bears smell distribution. Meanwhile, Wall Street 'experts' still can't decide if BTC is digital gold or a hyper-volatile tech stock.

The Cynic's Take: Traders now parse Fed statements like medieval monks interpreting chicken bones—desperate for signals in the static. Maybe Satoshi was right to sideline central bankers altogether.

Market reacts to Fed’s rate cut decision

What’s interesting here is that, while the coin market stalls, ETFs are showing strength.

Spot Bitcoin ETFs, for instance, saw inflows of $388.3 million, whereas ethereum ETFs attracted $19.1 million, according to Farside Investors, hinting at sustained institutional interest even in a cooling market.

For context, the Federal Reserve decided to keep interest rates unchanged at 4.25% to 4.5%, stirring the crypto markets, as per The New York Times.

Market participants also appear to be holding back amid uncertainty over the Fed’s future course, especially with officials reportedly divided on the timing of potential rate cuts.

Trump slams Powell

Adding to the tension, President Donald TRUMP reignited his long-standing criticism of Fed Chair Jerome Powell, calling him “stupid” just hours before the policy announcement.

Trump argued that the central bank’s benchmark rate should be at least two percentage points lower, underscoring the political pressure mounting around the Fed’s monetary stance.

Trump made the offhand comment outside the WHITE House, where he said,

“So we have a stupid person. Frankly, you probably won’t cut today. Europe had 10 cuts, and we had none. And I guess he’s a political guy, I don’t know. He’s a political guy who’s not a smart person, but he’s costing the country a fortune.”

What are the numbers hinting at?

While recent inflation data has shown signs of easing, the Federal Reserve remains hesitant to shift its monetary stance.

The Consumer Price Index for May ROSE by just 0.1%, pushing the annual inflation rate down to 2.4%, edging closer to the Fed’s 2% target.

Similarly, April’s Personal Consumption Expenditures saw minimal growth.

However, despite these improvements, Fed officials remain cautious, citing lingering uncertainties tied to global economic pressures, including the fallout from former President Donald Trump’s trade policies.

Emphasizing the unpredictability of the scope and duration of tariff-related impacts, Fed Powell said, 

“We know that the time will come. It could come quickly, it could not come quickly. As long as the economy is solid, though, as long as we’re seeing the kind of labor market that we have, and reasonably decent growth and inflation moving down, we feel like the right thing to do is to be where we are.” 

Fed rate cut is not the only cause behind the flat market

While the Federal Reserve’s stance has certainly played a role in dampening market sentiment, broader global developments have also contributed to Bitcoin’s recent volatility.

From renewed tariff threats under Trump to escalating geopolitical tensions between Iran and Israel, external pressures are weighing heavily on investor confidence.

On-chain indicators further suggest a bearish trend, with more wallet addresses aligning with bearish activity than bullish, hinting at a potential price dip ahead.

Source: IntoTheBlock

Since Bitcoin often sets the tone for the broader crypto market, any significant drop could trigger widespread corrections.

Therefore, as multiple factors converge, the road ahead for bitcoin remains uncertain, leaving investors on edge as they await the next decisive shift.