XRP news today: Crypto Market Braces for Volatility Ahead of Fed Decision

As traders await the Federal Reserve's rate decision, the cryptocurrency market is bracing for potential volatility. According to Volmex's implied volatility indices, major tokens such as Bitcoin, Ether, Solana, and XRP could experience price swings, but these movements are not expected to be extraordinary.

Bitcoin's annualized one-day implied volatility index (BVIV) stands at 49%, which translates to an expected 24-hour price swing of 2.56%. This means that Bitcoin could fluctuate by approximately $2,470 in either direction, given its current price of around $96,500. The expected daily volatility in percentage terms is calculated by dividing the annualized percentage by the square root of 365, as the digital assets market operates 24/7.

Ether's annualized one-day volatility is at 66%, suggesting a 24-hour price swing of 3.45%. Similarly, Solana's SOL token is expected to move by 4.3% within a 24-hour period. For XRP, the forward implied volatility (IV) derived from options listed on Deribit stands at 77.98%, equating to a one-day expected move of 4.08%.

The Federal Reserve is scheduled to announce its rate decision at 18:00 UTC, followed by Chairman Jerome Powell's press conference at 18:30 UTC. While the central bank is expected to keep rates unchanged, any commentary on the economic outlook or hints at a potential rate cut in June could significantly impact the markets.

Bitcoin's price experienced notable volatility on Wednesday, surging to $97,260 after initially retracing below $94,000. This price movement was influenced by heightened geopolitical tensions in Asia, specifically following India's missile attack on Pakistan. The attack triggered widespread market volatility, with Bitcoin's price initially plunging towards $93,500 before recovering. The sudden nature of India's strike added to market uncertainty, reinforcing Bitcoin's sensitivity to geopolitical events.

Traders reacted swiftly to the news, leading to sharp liquidations and exits from leveraged positions. Despite the initial drop, Bitcoin managed to hold above $93,500, signaling support near last week’s local lows. The market's reaction was further influenced by diplomatic efforts, with the White House confirming talks with both India and Pakistan. President Trump's call for calm and de-escalation efforts were viewed positively by the market, contributing to Bitcoin's recovery to $97,100.

The geopolitical unrest between India and Pakistan led to significant market volatility, with data showing that Bitcoin broke through $734 million in short positions clustered around the $95,600 level. This key resistance level aligned with several recent pullbacks, marking a crucial psychological boost for bulls. As Bitcoin reclaimed that zone, bears were forced to exit positions, resulting in short liquidations that pushed the price upward. This cascade brought Bitcoin near its earlier peak of $97,260.

With the $95,600 resistance cluster now broken, bulls could potentially push for another leg-up towards last week’s peak above $98,200. If diplomatic efforts continue to de-escalate tensions and global supply chains remain undisrupted, rising institutional demand could propel Bitcoin's price towards the next major milestone target at $100,000.

Other major cryptocurrencies also experienced price swings. Ether fell 2.1% to $1,762.52, taking little support from a recent update on the Ethereum Foundation's long-term goals. Solana also saw a decline, falling 1.1%. The market's focus on the Federal Reserve's upcoming decisions added to the overall volatility, with traders unwilling to push prices far in either direction ahead of the Fed's announcement. This cautious approach reflects the market's anticipation of potential price swings induced by the Fed's monetary policy decisions.