BIGGEST FED RATE HIKE IN 40 YEARS? 5 THINGS TO KNOW IN BITCOIN THIS WEEK

Bitcoin, the bellwether of the crypto market, finds itself at a precarious crossroads.The winds of macroeconomic policy are whipping fiercely, and all eyes are on the Federal Reserve as it prepares to make a crucial decision on interest rates.Will it be a gentle nudge or a sledgehammer blow to the crypto market and other risk assets?Speculation is rife, with some predicting the largest Federal Reserve rate increase in 40 years. bitcoin crypto cryptodailynews fedratehike ethmerge bitcoindailynews fypThis uncertainty has already sent ripples through the market, contributing to recent price volatility and fueling anxieties among investors.But what does this all mean for Bitcoin in the coming days?The cryptocurrency has struggled to establish a firm foothold above $20,000, and the fear is that this level could transform into a formidable resistance.As we navigate this crucial week, let's delve into five key factors that could significantly impact Bitcoin's trajectory and help you understand what to expect in this volatile landscape.

1.The Looming Fed Rate Hike: A Potential Crypto Sledgehammer

The week's main event is undoubtedly the Federal Reserve's decision on interest rates. The crypto market is in free fall as speculation of the next largest Federal Reserve rate increase in 40 years mounts. Bitcoin and Ethereum are losing a lot of value and tumbling big among the top 10. The weekends have not been good for the crypto market as of late. In fact, these past few [ ]After August's Consumer Price Index (CPI) numbers exceeded expectations, pressure is mounting on the Fed to take decisive action to combat inflation. Bitcoin (BTC) faces another week of huge macro announcements after the lowest weekly close since July. After days of losses following the latest inflation data from the United States, BTC/USD, like altcoins and risk assets more broadly, has failed to recover. The largest cryptocurrency has yet to flip $20,000 to convincing support, and as theThe question isn't *if* they will raise rates, but *by how much*?The Federal Open Markets Committee (FOMC) previously raised its target interest rates by 75 basis points, marking the most significant hike since 2025.Now, some analysts, like those at Nomura, are predicting a full-percentage-point increase.This hawkish stance reflects the ongoing battle against persistent inflation, which recently hit a 40-year high of 8.6%.

A substantial rate hike can act as a ""sledgehammer"" to risk assets like cryptocurrencies.Here's why:

• Reduced Liquidity: Higher interest rates make borrowing more expensive, decreasing the amount of money available for investment in riskier assets.
• Increased Dollar Strength: Rate hikes tend to strengthen the U.S. dollar, which can negatively impact Bitcoin, as it is often seen as an alternative store of value.
• Risk-Off Sentiment: Investors tend to become more risk-averse in a high-interest-rate environment, preferring safer investments like bonds.

Therefore, the magnitude of the Fed's rate hike will be a critical factor in determining Bitcoin's short-term price movement.

2.Bitcoin's Struggle to Overcome $20,000 Resistance

Despite multiple attempts, Bitcoin has consistently failed to convincingly break above the $20,000 mark and establish it as a solid support level.This persistent resistance creates a bearish sentiment among traders, raising concerns that the price could fall further.

Several factors contribute to this struggle:

• Macroeconomic Uncertainty: As discussed earlier, the looming Fed rate hike casts a shadow over the entire market, making investors hesitant to commit to risky assets.
• Negative News Flow: A constant stream of negative news, including regulatory concerns and potential market crashes, dampens investor enthusiasm.
• Lack of Institutional Adoption: While institutional interest in Bitcoin has grown, it hasn't reached the levels needed to propel the price significantly higher.

If Bitcoin fails to break through the $20,000 resistance, it could trigger further sell-offs and potentially lead to a retest of lower support levels.

3.U.S. Fed target rate probabilities chart. Source: CME Group This week, the long anticipated March Fed interest rate decision comes out. Currently, markets are pricing in a 62% chance of a 25 bpsDollar Strength and Its Impact on Bitcoin

The strength of the U.S. dollar plays a crucial role in the Bitcoin market. Bitcoin (BTC) starts the first week of December looking better than it has since early 2025 at over $40,000. BTC price action is delighting bulls already as the month begins, with the weeklyA stronger dollar generally puts downward pressure on Bitcoin's price, as it becomes relatively more expensive to purchase Bitcoin using other currencies.Conversely, a weaker dollar can boost Bitcoin's price, as it becomes more attractive to investors seeking alternative assets.

The Fed's rate hike decision will likely influence the dollar's strength. Biggest Fed rate hike in 40 years? 5 things to know in Bitcoin this week⁣ fedrate bitcoin years fedrates ratehikeA more aggressive rate hike could further strengthen the dollar, potentially exacerbating the challenges for Bitcoin. Bitcoin (BTC) begins a new week with a wobble and fresh all-time highs as BTC price volatility stays firmly in charge. The largest cryptocurrency has sealed its highest-ever weekly close, butKeep a close eye on the Dollar Index (DXY) to gauge the dollar's overall performance and its potential impact on Bitcoin.

4.Bitcoin On-Chain Data: Potential Bullish Signals?

While price action paints a cautious picture, some on-chain data suggests potential bullish signals.For instance, the supply of Bitcoin that hasn't moved in the last 5-7 years recently reached a near two-year high.This indicates that long-term holders are remaining steadfast, suggesting confidence in Bitcoin's long-term prospects.

Furthermore, the supply of Bitcoin that hasn't moved in the last 6-12 months also reached a multi-month high. The Federal Open Markets Committee (FOMC) raised its target interest rates by 75 basis points on Wednesday, the largest rate hike since 2025. The raise came in line with market expectations that foresaw a more hawkish committee in action as latest inflation figures came above expectations, marking a new 40-year high at 8.6% .This suggests that a significant portion of Bitcoin is being held by investors who are less likely to sell in the short term.Another metric to watch is Bitcoin's hash rate, which reflects the computing power dedicated to mining the cryptocurrency. The U.S. dollar has plummeted to its lowest level since 2025 on fresh tariffs threats from U.S. president Donald Trump and the Senate considers Trump s big, beautiful tax bill that sA high hash rate indicates a strong and secure network, which can be a positive sign for Bitcoin's overall health.

Analyzing On-Chain Data for Investment Decisions

While on-chain data can provide valuable insights, it's crucial to use it in conjunction with other indicators, such as technical analysis and macroeconomic factors.Relying solely on on-chain data can be misleading, as it doesn't always accurately predict future price movements.Consider using a combination of tools and strategies to make informed investment decisions.

5.Key Bitcoin Price Levels to Watch

Navigating this week's volatility requires a clear understanding of key price levels.These levels can act as potential support or resistance zones, influencing Bitcoin's price trajectory.

• Resistance: The immediate resistance level remains at $20,000.A sustained break above this level could signal a potential bullish reversal. It could be coming this week. Nomura predicts a full-percentage-point increase in U.S. interest rates Last Updated: Sept. 18, 2025 at 4:04 p.m. ET First Published: Sept. 13, 2025 at 3:27 p.m. ETAbove that, further resistance lies at $22,000 and $25,000.
• Support: Immediate support can be found around $16,500-$17,000. Bitcoin braces for the Fed interest rate decision with BTC price support in focus, along with the final innings of Bitcoin's relentless dominance surge. 8450 Total views Listen to articleA break below this level could lead to further declines, potentially retesting the $15,000 or even lower.

Monitoring these levels closely will help you anticipate potential price movements and make informed trading decisions.Remember that these are just potential scenarios, and market conditions can change rapidly.

Bonus: What Happens to Bitcoin After a Rate Hike?

Predicting Bitcoin's exact behavior after a rate hike is difficult. 与此同时，最后活跃于5至7年前的供应量，达到了近两年来的最高值 101万枚BTC。 最近活跃于5-7年前的比特币供应图表 来源：Glassnode/推特. 与此同时，最后活跃于6-12个月前的比特币也达到了自己的5个月高点2,208,460.681 BTC。Historically, rate hikes have often led to short-term price dips as investors re-evaluate their risk tolerance.However, the long-term impact depends on several factors, including the severity of the economic slowdown, the Fed's future policy decisions, and overall market sentiment.

Here are some possible scenarios:

• Scenario 1: ""Risk-Off"" Reaction: If the rate hike is perceived as aggressive and signals a significant economic downturn, investors may flock to safer assets, leading to a decline in Bitcoin's price.
• Scenario 2: ""Buy the Dip"": Some investors may view the price dip as an opportunity to buy Bitcoin at a discount, potentially leading to a rebound.
• Scenario 3: Long-Term Inflation Hedge: If inflation remains persistent despite the rate hike, Bitcoin may regain its appeal as a hedge against inflation, potentially driving its price higher in the long run.

Actionable Advice for Navigating Bitcoin This Week

1. Stay Informed: Keep abreast of the latest news and analysis regarding the Fed's rate decision and its potential impact on the crypto market.
2. Manage Risk: Avoid overexposure to Bitcoin and diversify your portfolio to mitigate potential losses.
3. Use Stop-Loss Orders: Implement stop-loss orders to limit potential losses in case of a sudden price drop.
4. Consider Dollar-Cost Averaging: Invest in Bitcoin gradually over time to reduce the impact of short-term price fluctuations.
5. Don't Panic Sell: Resist the urge to sell during market downturns, as this can often lead to losses.

Conclusion: Navigating the Fed Rate Hike and Bitcoin's Future

This week promises to be pivotal for Bitcoin, with the Federal Reserve's rate hike decision casting a long shadow.While the potential for a significant rate increase raises concerns about short-term price volatility, it's crucial to remember that Bitcoin's long-term prospects remain tied to its fundamental value proposition and its ability to evolve as a decentralized, censorship-resistant store of value.Keep a close eye on the key factors discussed in this article, including the magnitude of the rate hike, Bitcoin's ability to overcome resistance, the strength of the U.S. dollar, on-chain data, and key price levels.By staying informed and managing risk effectively, you can navigate this uncertain period and position yourself for potential opportunities in the Bitcoin market.Remember, the crypto market is inherently volatile, so invest wisely and only risk what you can afford to lose. The largest cryptocurrency has yet to flip $20,000 to convincing support, and as the third full week of September begins, the danger is once again that that level could function as resistance. Bulls have plenty to worry about the coming days will see the Federal Reserve decide on the next key rate hike, something that will affect the marketThis week might bring short-term pain, but the future of Bitcoin, although uncertain, still holds promise for those who believe in its core tenets. Cointelegraph analyzes five potential factors affecting the bitcoin market to watch in the coming week. Fed rate hike 'hit' in focus. The main event of the week is the Federal Reserve's decision on key interest rates. The Fed will be under pressure to respond after August consumer price index (CPI) results came out hotter than expected.Do your own research and make informed decisions. Bitcoin launches into a new week inches from fresh all-time highs after sealing its best-ever weekly close.Bitcoin traders see price discovery returning in the coming week while eyeing levelsConsider speaking with a qualified financial advisor before making any investment decisions.