Bitcoin experienced a rapid shift in momentum on May 7 as market volatility surged due to fresh geopolitical developments and anticipation surrounding the Federal Reserve’s upcoming interest rate decision.
Sudden Spike in Price Amid Global Tensions
BTC/USD briefly fell below $94,000 before rebounding to a local high of $97,700. The price action mirrored broader market uncertainty fueled by escalating tensions between India and Pakistan and ongoing US-China trade negotiations.
Gold also surged alongside Bitcoin, with both assets acting as safe havens during increased geopolitical instability. Gold reached a high of $3,435 before consolidating.
Fed Decision Looms Over Market Sentiment
The primary focus now turns to the Federal Reserve’s policy meeting and subsequent press conference from Chair Jerome Powell. Although no immediate rate change is expected, traders are closely watching for changes in tone. “The market will be eager to watch for any dovish or hawkish changes in their tone, which has been pretty mixed recently,” noted trader Daan Crypto Trades.
Traders Monitor Liquidity and Market Reactions
Keith Alan of Material Indicators pointed to recent order book activity as a sign of pre-FOMC market tension. “Pleasantly surprised BTC held above the YOU, but won’t be surprised if price round trips the range before the end of the week,” he said, referencing the $93,500 yearly open as a downside target.
Meanwhile, on-chain analyst Darkfost observed that rate cut odds for the June meeting had dropped to around 30%. “Expectations are clearly pessimistic for now,” he said. “If the Fed does decide to cut rates in this context, it will trigger volatility and might spark fear among investors.”
As the market braces for the Fed’s tone, Bitcoin remains highly sensitive to macroeconomic signals and global uncertainty.