Bitcoin Faces Critical Test Above $80K as Fed Rate Decision Weighs

Bitcoin has been trading near $80,418 after a strong rebound, but its next move depends on whether buyers can defend the $79,000-$80,000 area.

The recent Federal Reserve rate increase and mixed ETF flows are factors that could impact Bitcoin's price. The Fed raised the federal funds target range by 25 basis points to 3.75%-4.00%, citing elevated inflation and resilient economic activity.

Bitcoin's current setup reflects three overlapping forces: macro policy, institutional demand, and technical momentum. Macro policy refers to the Federal Reserve's decision to raise interest rates, which can pressure assets with no cash yield. Institutional demand is driven by spot Bitcoin ETFs, which recorded a positive end to the latest week with about $433 million of net inflows on Friday.

According to the chart, Bitcoin has reclaimed $80,000 after a period of lower trading and is currently consolidating above several short-term moving-average reference levels. The next area to watch is near $81,305, which is the recent daily high.