Bitcoin Recovery Hits Speed Bump Ahead of FOMC Meeting

Cryptocurrency markets are showing tentative signs of recovery after hitting recent lows, but the rebound is fragile and faces significant headwinds. Bitcoin has been attempting to stabilize near the $65,500 level, which represents a key support zone.

The market's cautious approach is reflected in the weak institutional demand for cryptocurrencies, with Bitcoin ETFs suffering net outflows of around $5.8 billion over the past month. This trend is consistent with historical patterns, where investors tend to sell their positions after FOMC meetings.

The upcoming Fed decision under new Chair Kevin Warsh adds uncertainty to the market, as traders assess how he will balance growth risks against persistent inflation concerns. A hawkish tone from the Fed could weigh on sentiment and put downward pressure on crypto prices.