Bitcoin Holds Near $89K as FOMC Begins, History Signals Post-Decision Volatility

The crypto market is largely stable but leaning weak, with prices moving in narrow ranges and no clear breakout in sight. Total market capitalization is holding near $3.02 trillion, slightly lower on the day. Bitcoin, Ethereum, and major altcoins are showing small gains and losses.

The Federal Open Market Committee is in the midst of its first 2026 meeting. For now, markets are expecting no change. Inflation has cooled, but not enough to force the Fed’s hand. CPI inflation held steady at 2.7%, while the Fed’s preferred gauge, PCE inflation, edged slightly higher to 2.8%. At the same time, recent labor data has come in stronger than expected. Together, this gives the Fed room to wait longer before cutting rates.

Crypto analyst Ali Martinez says traders should look at how behaves around FOMC decisions. History gives a warning. During 2025, Bitcoin reacted negatively after seven out of eight FOMC meetings, often with sharp pullbacks. Only one meeting delivered a brief upside move.

The pattern shows that even when markets hope for rate cuts, Bitcoin has usually faced higher volatility and downside pressure once the Fed’s decision is announced.

In January, Bitcoin dropped 27% after the decision. March saw a 14% decline. May was the lone exception, with a 15% bounce. But the weakness returned quickly: –8% in June, –6% in July, –7% in September, a steep –29% in October, and another –9% slide in December.

“Even though markets often price in optimism ahead of these meetings, driven by hopes that lower rates will support risk assets like crypto, the data shows that the reaction after the announcement has leaned bearish in the vast majority of cases,” the analyst .

Bitcoin is trading around $89,000 and is slowly moving higher after bouncing from Sunday’s low. An analyst Bitcoin is at a short-term crossroads. The price either needs to break above $89,000 or it could fall back toward $86,000. Holding $87,500 as support would be a positive sign and could open the door for a move higher.

However, another analyst a slightly different view. Looking at Bitcoin on lower time frames, they said a dip toward the $85,000 area around the FOMC meeting, followed by a bounce toward $92,000, would not be surprising.

According to the analyst, the nearest pool of strong liquidity sits below the current price, between $84,800 and $86,800, and this zone has not been tested yet. While there is also liquidity above the market, it is much farther away.