An analyst from Japan’s XWIN Research has observed that meetings of the U.S. Federal Open Market Committee (FOMC) tend to create opportunities for clearing excess positions rather than determining Bitcoin’s medium-term market trend. Historical data from NS3.AI indicates that following FOMC meetings, Bitcoin’s price does not establish a lasting direction; instead, short-term sharp fluctuations primarily result from the liquidation of highly leveraged investors. Bitcoin, the world’s most renowned cryptocurrency, is known for its price volatility, influenced by Federal Reserve monetary policies and interest rate decisions. However, the analysis reveals that Bitcoin’s short-term movements are driven more by reductions in leverage, easing selling pressure, and liquidity restoration rather than political factors or interest rate decisions. This insight is significant for investors, as it suggests that temporary market volatility after FOMC meetings does not necessarily signal a long-term trend change. Instead, such volatility acts as a market reset to reduce excess debt and risk levels. This dynamic encourages caution among investors, since entering the market with high leverage can lead to short-term losses. Going forward, Bitcoin’s price will continue to be influenced by monetary policies, global economic conditions, and intrinsic cryptocurrency factors, but understanding the short-term volatility linked to FOMC meetings will help investors develop better strategies.
Source: binance
