Bitcoin Closes at $79,873.02 Ahead of Fed Meeting This Week
Key Facts
Bitcoin closed at $79,873.02 on October 26, down from $81,938.40 on October 19, according to EL7 data. The close came ahead of the Federal Reserve meeting scheduled for October 27 and 28, as investors were expecting rates to hold steady in October, according to the Associated Press. In intraday trading, the cryptocurrency rose 0.3% to $80,560.7 at 09:46 GMT, according to Investing.com. But the same report said Bitcoin fell about $2,000 over the weekend. It was trading near the lower end of a range between $80,000 and $87,000 that had held over the previous month.
In a report published on October 5, Bitfinex said continued trading below $81,300 alongside outflows from spot Bitcoin funds could bring the $77,000 area back into focus. The report said the market’s realized price was $77,200, another level that could regain significance in that scenario. The company tied this possibility to two simultaneous conditions—continued trading below the specified level and outflows—and did not present it as an outcome that had occurred. U.S. funds had taken in $241.1 million during the week from September 28 to October 2, compared with $2.39 billion the previous week. The contrast shows a decline in inflows between the two weeks compared in the report.
Bitcoin futures open interest fell by 79,000 Bitcoin over a week to 625,000 Bitcoin, its lowest level since January 1, according to Bitfinex. The report described the decline as an “orderly reset,” referring to the reduction in the volume of open positions during the period it covered. In the U.S. labor market, September data showed nonfarm payrolls increased by 29,000 and the unemployment rate rose to 4.2%. The increase was below the average monthly gain of 45,000 jobs over the previous twelve months, according to the Bureau of Labor Statistics. Bitfinex’s October 5 report cited the jobs and unemployment figures as part of its market backdrop.
Interest-rate data showed the effective rate reached 4.0% on September 16, after standing at 3.75% on July 29, according to EL7 records. This is a recorded rate reading, while expectations concerned the upcoming meeting’s decision; the Associated Press reported that investors expected rates to hold steady in October and then rise in December. Bitfinex’s report showed the probability of rates holding steady in October rose to 79.5% on October 5, from 29.1% a week earlier. The agency also cited minutes from the previous meeting showing that most Federal Reserve officials expected another rate increase to be needed during the year. These expectations place the October meeting in the context of a difference between what investors considered likely and what bank officials expected, according to the sources.
The Federal Reserve will hold its meeting on October 27 and 28, with the press conference set to begin at 2:30 p.m. on October 28, according to the official calendar. The next meeting of the Federal Open Market Committee follows on December 8 and 9. This week’s data include the September personal consumption expenditures report, scheduled for release Thursday, according to the Associated Press. The index recorded annual inflation of 3.4% in August, according to the Bureau of Economic Analysis, which set October 29 as the date for the next update. Investors are watching these dates in a week that includes an interest-rate decision and inflation data, while the Bitcoin levels identified by Bitfinex remain contingent on trading activity and fund flows.