Bitcoin Faces 3% Weekly Decline Ahead of FOMC Meeting

Bitcoin is currently facing a critical juncture as it approaches the end of the week, with analysts warning that a weekly close below $81,000 could trigger further downside volatility. This comes at a pivotal time, just ahead of the Federal Open Market Committee (FOMC) meeting scheduled for next week, which is expected to provide more insights into the Federal Reserve's monetary policy for the year 2025.

Over the past week, Bitcoin's price has declined by more than 3%, currently trading above $83,748 as of 9:33 a.m. in UTC. The downward pressure on Bitcoin is attributed to growing macroeconomic uncertainties, particularly around global trade tariffs, according to Ryan Lee, chief analyst at Bitget Research. Lee emphasized that closing the week above $81,000 is crucial to avoid further downside risks. He noted that if Bitcoin drops below $76,000, it could invite more short-term selling pressure.

The FOMC meeting, scheduled for March 19, is anticipated to have a significant impact on Bitcoin investor sentiment. Currently, markets are pricing in a 98% chance that the Federal Reserve will keep interest rates steady. However, any unexpected hawkish signals from the Fed could put pressure on Bitcoin and other risk assets. Conversely, a dovish surprise, such as a rate cut, might not immediately boost Bitcoin prices due to ongoing macroeconomic uncertainties.

Despite the current challenges, some analysts see potential for a positive turnaround. Enmanuel Cardozo, market analyst at Brickken, a real-world asset tokenization platform, suggests that a weekly close above $85,000 could inspire more investor confidence and lead to the next breakout. Cardozo highlighted that traders and investors are closely monitoring the $80,000 support level and the $85,000–$90,000 resistance range, with a break above the latter potentially sparking a strong upward movement.

While short-term momentum may be limited by upcoming economic releases, regulatory developments around Trump’s Bitcoin reserve plan could gradually bring more market optimism and mass adoption. The bill introduced by US Representative Byron Donalds aims to codify Trump’s Bitcoin reserve, ensuring it becomes a permanent fixture and preventing future administrations from dismantling it through executive action. If passed, the bill would require at least 60 votes in the Senate and a House majority, which is feasible given the current political landscape and the generally more crypto-friendly environment.