Bitcoin Hovering Below $40,000 Ahead Of Fed Meeting

 | Jul 29, 2021 12:46AM ET

Bitcoin continues its positive streak, rising for seven consecutive days since Wednesday.

Bitcoin has taken an attempt to break $40,000 for the second time this week, with the Fed’s FOMC policy meeting acting as a source of uncertainty.

h2 Bitcoin’s Positive Consolidation around FOMC Meeting/h2

Markets are eyeing the Federal Reserve’s decision on the timeline for phasing out quantitative easing.

Bitcoin shrugged off the selling pressure after Amazon (NASDAQ:AMZN) denied rumors that it would begin accepting crypto payments, holding above the 200-day moving average at $34,600.

A bigger threat looms with the Fed’s policy meeting beginning today, where US central bank heads will decide on tapering asset purchases.

If the Fed continues its dovish approach in supporting the economy via a $120 million bond purchase and near-zero interest rates throughout 2022, BTC is likely to continue upwards.

However, a hawkish stance of the Fed will hurt the rising inflation narrative and potentially act as a negative catalyst for Bitcoin’s price.

In the Fed’s last meeting in mid-June, some hands went up for increasing the rates in late 2022, contrary to initial plans. The markets expect the Fed to maintain the status quo in delaying the purchase until 2023 as the threat of the COVID-19 Delta variant and supply-chain hurdles are negatively affecting the economy.