– Bitcoin price volatility has increased this week, invigorated by the US CPI and upcoming FOMC decision.- Despite the confidence of boomers, crypto markets look insecure with BTC barely holding above $40,000, with a possible range likely developing.- $37,800 will be critical for the king of crypto, which if lost on the weekly timeframe could precipitate a $30,000 retest.Bitcoin ( [BTC](https://www.fxstreet.com/cryptocurrencies/news/top-3-price-prediction-bitcoin-ethereum-ripple-btc-defends-40-000-a-month-ahead-of-spot-etf-approvals-202312111900)) price is showing weakness heading into the Federal Open Market Committee (FOMC) meeting slated for December 13.The Federal Reserve chair [Jerome Powell](https://www.fxstreet.com/macroeconomics/central-banks/fed) is expected to give a summary of economic projections after Consumer Price Index (CPI) data delivered relief, showing inflation in the US has [declined to 3.1%](https://www.fxstreet.com/cryptocurrencies/news/bitcoin-price-spikes-to-42-000-in-response-to-november-us-cpi-data-release-202312121352) in line with market expectations.Also Read: [Bitcoin price spikes to $42,000 in response to November US CPI data release](https://www.fxstreet.com/cryptocurrencies/news/bitcoin-price-spikes-to-42-000-in-response-to-november-us-cpi-data-release-202312121352) Bitcoin price braces for more volatility ahead of FOMC Ahead of the FOMC meeting, investors show caution, de-risking, evidenced by the 40% drop in trading volume over the last 24 hours.Upon the November US CPI data release, Bitcoin price jolted only briefly to $42,000 before pulling back.
Looking ahead, the general opinion is that the Fed will hold rates steady at a target of 5.25-5.50%.
During the [most recent meeting in November](https://www.fxstreet.com/cryptocurrencies/news/fomc-and-microstrategy-push-bitcoin-above-35-000-but-altcoins-could-benefit-the-most-202311012303), the FOMC held rates steady, as well as during the September gathering, with a signal that the rates could remain unchanged for the foreseeable future, but maintained an openness to changing this stance, based on economic conditions.Putting rates hikes on hold was a largely expected outcome as it gave the Fed more time to determine whether the current rates were actually keep inflation at bay at the expense of economic growth.The 5.25% to 5.50% bar was raised during the July meeting, marking 11 rate hikes across the 2022/2023 cycle, all geared towards managing inflation.It explains the insecurity seen in Bitcoin price Implication for Bitcoin price Increasing interest rates inspires caution among investors, causing an effective aversion of risk-based assets such as cryptocurrencies.
Based on the CME FedWatch tool, there is a 97.1% chance that the Fed will keep the Federal target rate at 5.25% to 5.50% in the upcoming FOMC meeting, while 2.9% of the opinion polls anticipate a change to 5.50 – 5.75% FedWatch Tool CME It should be noted that the degree of certainty between November 10 and December 13 has reduced.In just under 48 hours, the optimism for a steady 5.25% to 5.50% has dropped from 99.8% to 97.1% as more market watchers anticipate a possible target rate adjustment to 5.50% -5.75%.Probabilities Meanwhile Bitcoin price volatility continues to increase, up almost 5% between December 10 and 13, moving from 29.20% to 33.81%.
BTC volatility It continues to hold thinly above the $40,000 psychological level, with investors showing caution, evidenced by the subdued Relative Strength Index (RSI).
Owing to the fact that the yields on assets dominated by the dollar reduce relatively when the FOMC reduces interest rates, investors seek returns elsewhere.As such, if the Fed raises the target to 5.50% -5.75%, [Bitcoin price](https://www.fxstreet.com/cryptocurrencies/news/top-3-price-prediction-bitcoin-ethereum-ripple-btc-defends-40-000-a-month-ahead-of-spot-etf-approvals-202312111900) could move north amid growing demand.In the same way, should the Fed maintain the 5.25%-5.50 threshold, BTC price could display little movement, possibly even dropping.BTC/USDT 1-day chart Either way, there is a possible range developing, with a move to $48,000 still in the cards before a more significant correction, although the $37,800 remains critical for the upside potential of [Bitcoin](https://www.fxstreet.com/cryptocurrencies/bitcoin) price.Losing the aforementioned level could set the tone for BTC to spiral to $32,000, or in the dire case, all the way to the $30,000 psychological level.Cryptocurrency prices FAQs How do new token launches or listings affect cryptocurrency prices? Token launches like Arbitrum’s ARB airdrop and Optimism OP influence demand and adoption among market participants.Listings on crypto exchanges deepen the liquidity for an asset and add new participants to an asset’s network.This is typically bullish for a digital asset.
How do hacks affect cryptocurrency prices? A hack is an event in which an attacker captures a large volume of the asset from a DeFi bridge or hot wallet of an exchange or any other crypto platform via exploits, bugs or other methods.The exploiter then transfers these tokens out of the exchange platforms to ultimately sell or swap the assets for other cryptocurrencies or stablecoins.Such events often involve an en masse panic triggering a sell-off in the affected assets.How do macroeconomic releases and events affect cryptocurrency prices? Macroeconomic events like the US Federal Reserve’s decision on interest rates influence risk assets like Bitcoin, mainly through the direct impact they have on the US Dollar.An increase in interest rate typically negatively influences Bitcoin and altcoin prices, and vice versa.If the US Dollar index declines, risk assets and associated leverage for trading gets cheaper, in turn driving crypto prices higher.
How do major crypto upgrades like halvings, hard forks affect cryptocurrency prices? Halvings are typically considered bullish events as they slash the block reward in half for miners, constricting the supply of the asset.At consistent demand if the supply reduces, the asset’s price climbs.This has been observed in Bitcoin and Litecoin.Information on these pages contains forward-looking statements that involve risks and uncertainties.Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets.
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The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.[Join Telegram](https://t.me/fxstreetcrypto) Follow us on Telegram Stay updated of all the news Recommended Content Editors’ Picks [Bitcoin price spikes to $42,000 in response to November US CPI data release](https://www.fxstreet.com/cryptocurrencies/news/bitcoin-price-spikes-to-42-000-in-response-to-november-us-cpi-data-release-202312121352) [](https://www.fxstreet.com/cryptocurrencies/news/bitcoin-price-spikes-to-42-000-in-response-to-november-us-cpi-data-release-202312121352) Market participants de-risked ahead of the November US Consumer Price Index (CPI) print and Federal Open Market Committee (FOMC) meeting, as Bitcoin (BTC) price declined 5% since Monday.BTC continues to consolidate after a bounce from $40,222 on Tuesday.[More Bitcoin News](https://www.fxstreet.com/cryptocurrencies/news?q=&hPP=15&idx=FxsIndexPro&p=0&dFR%5BTags%5D%5B0%5D=Bitcoin) [BNB price eyes bullish breakout, open interest in Binance Coin is on the rise](https://www.fxstreet.com/cryptocurrencies/news/bnb-price-eyes-bullish-breakout-open-interest-in-binance-coin-is-on-the-rise-202312121105) [](https://www.fxstreet.com/cryptocurrencies/news/bnb-price-eyes-bullish-breakout-open-interest-in-binance-coin-is-on-the-rise-202312121105) BNB price has climbed over 4% in the past week, despite legal challenges faced by Binance.
Open interest in Binance Coin climbed 31% in the past month, indicating that new buyers are interested in BNB.BNB price rally past the $260 level could confirm a bullish breakout in the asset.[More Binance News](https://www.fxstreet.com/cryptocurrencies/news?q=Binance&hPP=15&idx=FxsIndexPro&p=0) [XRP price sustains above $0.60 as Ripple roadmap prevents the SEC from circumventing securities law](https://www.fxstreet.com/cryptocurrencies/news/ripple-roadmap-prevents-the-sec-from-circumventing-howey-analysis-xrp-price-sustains-above-060-202312120600) [](https://www.fxstreet.com/cryptocurrencies/news/ripple-roadmap-prevents-the-sec-from-circumventing-howey-analysis-xrp-price-sustains-above-060-202312120600) The SEC v.Ripple lawsuit offers legal experts a lens to re-examine the application of existing securities law to digital assets like XRP.
Judge Torres’ ruling prevented the SEC’s circumvention of existing laws and enabled adaptive regulation, rather than a stifling approach.[More Ripple News](https://www.fxstreet.com/cryptocurrencies/news?q=&hPP=15&idx=FxsIndexPro&p=0&dFR%5BTags%5D%5B0%5D=Ripple) [Shiba Inu price looks set for recovery as SHIB on-chain metrics turn bullish](https://www.fxstreet.com/cryptocurrencies/news/shiba-inu-price-looks-set-for-recovery-as-shib-on-chain-metrics-turn-bullish-202312120806) [](https://www.fxstreet.com/cryptocurrencies/news/shiba-inu-price-looks-set-for-recovery-as-shib-on-chain-metrics-turn-bullish-202312120806) Different cohorts of holders are accumulating Shiba Inu tokens, supporting price gains.SHIB token supply on exchanges has declined in the past month.Shiba Inu ventures into physical merchandise for Web3 companies with “Shibacals.” [More Shiba Inu News](https://www.fxstreet.com/cryptocurrencies/news?q=shiba%20inu&hPP=15&idx=FxsIndexPro&p=0) [BTC uptrend capped by supply barrier at $43,860 as FOMO fails to suffice](https://www.fxstreet.com/cryptocurrencies/news/bitcoin-weekly-forecast-btc-uptrend-capped-by-supply-barrier-at-43-860-as-fomo-fails-to-suffice-202312081903) [](https://www.fxstreet.com/cryptocurrencies/news/bitcoin-weekly-forecast-btc-uptrend-capped-by-supply-barrier-at-43-860-as-fomo-fails-to-suffice-202312081903) Bitcoin (BTC) price uptrend has sustained since mid-September on the weekly timeframe but has since slowed down following the lack of tailwinds to drive the market.All along, narratives, themes and speculation were the driving factors, inspiring a wave of fear of missing out (FOMO) in the market.As it turns out, FOMO is not enough anymore.[Read full analysis](https://www.fxstreet.com/cryptocurrencies/news/bitcoin-weekly-forecast-btc-uptrend-capped-by-supply-barrier-at-43-860-as-fomo-fails-to-suffice-202312081903).
