Bitcoin Price Whipsawed by War Escalation and Dovish Fed Expectations

Bitcoin's price action has been whipsawed around $64,000 due to multiple macro headwinds. The US Federal Reserve is set to release its next interest-rate decision, a potential risk-asset volatility catalyst.

The FOMC meeting comes as markets are dealing with the aftermath of the US-Iran war escalation, which has led to an 8% spike in oil prices. This trend has added to concerns over inflation and interest rates.

According to CME Group's FedWatch Tool, market expectations for the Fed's decision are among the most divided in recent history. The data shows that there is a 66.3% chance of keeping current levels of 3.5%-3.75%, with a 0.25% hike attracting 33.7% odds.

Bitcoin's price has been caught between its 50-day simple (SMA) and exponential (EMA) moving averages, forming a range that began in mid-July. Trading volumes remain low, with spot-market volume at its lowest levels since July 2023.