BTC Finds Support Above $105K on De-Escalation Hopes, Fed Outlook Remains Uncertain
Analysts: Focus shifts to FOMC decision and inflation pressures June 19.
Key Points:
- Bitcoin (BTC) rebounds to around $105,000 in early trading amid reports suggesting potential dialogue between Iran and the US.
- US President Donald Trump proposes Fed Chair Jerome Powell as “stupid” during an economic rally, despite markets factoring in no interest rate cut at the June 18 FOMC meeting.
- Technical viewing suggests BTC’s order books position it near potential short squeeze zones, particularly around the $103,000 support.
- Geopolitical risk appears abated for now, aiding BTC/USD’s recovery after U.S. unemployment data broadly met expectations.
- Market sentiment leans toward maintaining current rates, with most positioning aligning with a hawkish path for the Federal Reserve.
Market Reaction to US Leadership Comments
Bitcoin staged a noticeable recovery early on June 18 following a tentative headline suggesting a softening of the Iran-Israel conflict. Prices mounted losses to about $103,857 on Bitstamp before staging a comeback.
Speaking during a White House event, President Trump confirmed Iranian outreach alongside skepticism regarding the conflict’s duration: “I said, ‘It’s very late,’… I didn’t think it would go to war. I thought it would stop, unfortunately, it reached out late.”
“I said, ‘It’s very late,’… I didn’t think it would go to war. I thought it would stop, unfortunately, it reached out late.” – Donald Trump
FOMC Concerns and QCP Capital Outlook
This news provided brief positive catalysts. However, market participants acknowledge that sustained upside faces immediate FOMC uncertainty.
Geopolitical instability, particularly oil prices and anticipatory trade tariffs, are expected to weigh on inflation readings.
“Our expectation is for the Fed to hold rates steady while striking a hawkish tone,” noted QCP Capital in its analysis.
The QCP Capital analysis further added, “The Fed reducing its forecast for 2025 cuts would likely pressure risk assets… as liquidity expectations are pared back.”
Trader Perspectives: Short Squeeze Watch
Traders are acutely aware of the upcoming Federal Reserve decision and potential for a liquidity event pushing prices higher.
Monitoring resources indicated order books exhibit softer bid depth near key levels.
“Orderbooks are skew towards bid depth – More bids closest to price vs asks. Perp positioning is pretty short,” a monitor observed.
CoinGlass heatmaps and order book data suggest significant contangoed short positions potentially poised for liquidation if the price holds above $103,000.
“$BTC shorts liquidations loading… Cleaning them up before the end of the week?” – Twitter user TheKingfisher
Technical Context and Price Action
Technical charts from major monitoring platforms showed BTC/USD reversing from recent intraday support.
The market dynamic resembles a potential setup for a short squeeze event, driven partly by anticipation and positioning ahead of the pivotal FOMC decision.
Outlook: FOMC Decision Dominates
With the Fed’s policy stance heavy on inflation concerns stemming from global instability, immediate near-term confidence in a cut dwindles.
President Trump’s continued calls for easing measures, juxtaposed against the market’s nearly unanimous view on FOMC inaction, highlight a divergence likely to persist this week irrespective of the BTC market structure.
