Bitcoin Nears Key Support Ahead of FOMC as On‑Chain Signals Warn of Volatility
Bitcoin trades around $87,000 as markets brace for the upcoming FOMC meeting, with low odds (2.8%) of a January rate cut. Historical reactions to FOMC decisions have often produced sharp Bitcoin drawdowns — seven of eight meetings last year were followed by declines, including drops of 27%, 14%, 29% and 9% after several meetings. On‑chain metrics flag elevated downside risk: Active Investor Mean sits near current price (a decision zone), Short‑Term Holder Cost Basis is around $96,500 (recent buyers underwater), True Market Mean near $80,700 (a stronger demand zone), and Realized Price roughly $56,000. Analysts (BitBull, Ali Martinez, MartyPart) warn that losing the $87,500 level could push BTC toward the $80,700 demand area, while bounces may prompt short‑term holder selling. The combination of a hawkish Fed outlook, poor on‑chain breadth, and clustered macro events increases the probability of heightened intraday volatility. Traders should monitor FOMC developments, key supports at ~$87.5k and ~$80.7k, short‑term holder behavior, and realized‑price related on‑chain signals when sizing risk and positioning.
Bearish
The article highlights multiple bearish factors that raise the likelihood of near‑term downside for BTC. Historical FOMC reactions have more often produced sharp losses; with current market pricing showing minimal chance of a rate cut and a hawkish Fed path, liquidity and risk appetite are less supportive. On‑chain metrics compound the risk: active investor mean sits at current prices (a decision point), short‑term holders are underwater (cost basis ≈ $96.5k) and the realized‑price signals have previously preceded declines. Analysts flag $87.5k as a defend/lose pivot — loss would likely target the $80.7k demand zone. In the short term this implies elevated volatility, higher probability of pullbacks and increased selling pressure on bounces. For longer horizons, long‑term holders remain intact and stronger demand around the realized mean ($56k) suggests that severe capitulation would be needed before a structural bull reversal is negated. Traders should therefore reduce leverage, use tighter risk controls around the listed pivots, and watch FOMC communications and on‑chain flows for confirming signals.