Bitcoin Price Volatility Catalysts Loom Ahead of Fed Decision

A recent study by Coin Metrics found that Bitcoin's price has been reacting more strongly to US economic data releases than to Federal Reserve rate decisions. This pattern will be tested again this Friday, with the market awaiting the central bank's decision next Wednesday.

The core consumer price index (CPI) report is due on Friday at 8:30 a.m. EDT, and a hotter print could reinforce rate pressure, while a softer reading might provide relief for Bitcoin and broader risk appetite. According to Joe Mazzola of Charles Schwab, the consensus forecast for annual core CPI is 2.3%, a five-year low.

The market's focus will also be on the Federal Reserve's rate decision next Wednesday, with Fed Chair Kevin Warsh's comments potentially offering more clues for the market and moving Bitcoin's price further.