Bitcoin and cryptocurrency traders are eagerly anticipating the outcome of today's Federal Open Market Committee (FOMC) meeting conducted by the US Federal Reserve (Fed). Scheduled for 2:00 pm EST, the release of the interest rate decision will be followed by a press conference at 2:30 pm EST. This event holds significant importance as it is expected to influence the market in the coming weeks.

The prevailing sentiment among experts suggests that the Fed will opt for a pause in rate hikes. The CME FedWatch tool currently indicates a 95.3% probability of no change in interest rates. By maintaining the current levels, the central bank will have more time to assess the impact of its efforts to combat inflation.

Notably, major banks such as Goldman Sachs, J.P. Morgan, and Morgan Stanley share this expectation, except for Citi, which anticipates another 25 basis point rate hike. The crucial aspect to watch for during the meeting is the release of the "dot plot," which represents the Fed members' projections of future interest rate trajectories. Any upward revisions in these projections could lead to a decline in equities and an increase in the dollar index (DXY), potentially affecting the Bitcoin and cryptocurrency markets in a similar manner.

While the US bond market currently anticipates another rate hike by the Federal Reserve and a subsequent rate cut by the end of 2023, experts believe the outcome could be more binary. Michael Contopoulos, director of fixed income at Richard Bernstein Advisors, suggests that either the Fed will refrain from cutting rates, or a significant economic slowdown would prompt aggressive cuts. His inclination is toward the former scenario, speculating that higher-than-expected Consumer Price Index (CPI) data might push the Fed towards a hike. However, if CPI remains within expectations, a pause is more likely.

The bond market's current pricing indicates a prediction of 200 basis points in rate cuts for 2024, implying that a recession might not materialize until next year. This outlook aligns with the assessment of several experts.

Nevertheless, it should be noted that a rate hike by the Fed after a pause is not entirely implausible. The Bank of Canada (BoC) serves as an example, having raised rates by 25 basis points in June despite a two-month pause. The CME FedWatch Tool assigns a 63% probability of another quarter-point rate hike in July. Consequently, the "dot plot" released during today's FOMC meeting could significantly impact equities, #bitcoin , and the broader crypto market, depending on the direction of the revisions.

At the time of writing, Bitcoin remains relatively stable ahead of the interest rate decision. In the 1-hour chart, there is a promising possibility of a breakout from the current mini range around the FOMC meeting, triggering increased .

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