Fed's Tightening Sentiment Sends Bitcoin Dipping Below $65,000

The Federal Reserve's decision to hold interest rates unchanged on June 17 had a ripple effect on Bitcoin, which dipped roughly 2% in value. The cryptocurrency is now trading near $64,300, still within its recent range of $64,000 to $65,000.

The Fed's policy outlook has tightened, with nine out of 18 submitted dot-plot projections pointing to at least one rate hike before year-end. This shift in tone has traders pricing a 72% chance of a hike by October and a 78% chance of a hike by December.

According to Matt Mena, senior crypto research strategist at 21Shares, the no-change vote was a formality wrapped around a real signal. He notes that the median dot now points toward a possible hike later this year, a sharp reversal from the cuts markets were still penciling in three months ago.

Gerry O'Shea, head of global market insights at Hashdex, expects Bitcoin to trade in the $60,000 to $70,000 range in the coming weeks, absent a major catalyst. He points out that sentiment remains weak due to notable IPOs and AI stocks pulling attention away from crypto.