Crypto markets spent the weekend treading water, with total capitalization hovering around $2.3 trillion as traders looked past a ninth consecutive night of U.S. strikes against Iran and focused on the Federal Reserve's next move. Bitcoin is trading near $64,700, pinned between support at $62,000 and resistance just above $65,000, while Ethereum holds around $1,870, refusing to give up recent gains. The CME Fed Watch Tool now gives an 85.6% probability that interest rates will remain unchanged at the Fed's meeting on July 29, a view backed by fresh analysis suggesting the disinflationary trend still has legs.
Rate outlook holds steady
Elmar Voelker, an analyst at LBBW, said in a note that the disinflationary trend that began in 2023 appears intact, giving the Fed little reason to hike rates next week. The comment lands as U.S. stocks continued cooling last week on renewed inflationary pressures, and as crude oil prices climbed — WTI hit $85 a barrel, Brent topped $90 — partly driven by the U.S. Central Command's ongoing strikes against Iranian military capabilities used to attack commercial vessels in the Strait of Hormuz. For crypto, a steady Fed means the macro pressure that pushed Bitcoin below $60,000 in recent months isn't likely to worsen anytime soon.
Bitcoin stuck in a range
Bitcoin closed another weekly candle above the 200-week moving average, a technical level long-time holders watch closely. But the asset hasn't been able to break above $65,000 for more than a few hours at a time. The range-bound action reflects a market that's waiting for a catalyst — the Fed decision, or perhaps earnings from Tesla and Alphabet due Wednesday, or Intel's report on Thursday. Initial jobless claims and July S&P Global Manufacturing PMI data round out the week's economic calendar, any of which could shake the current equilibrium.
Energy markets in focus
The geopolitical backdrop isn't fading. U.S. strikes against Iran entered a ninth night this weekend, targeting military assets the Pentagon says are used to threaten commercial shipping. So far the conflict hasn't directly disrupted crypto trading infrastructure, but rising oil prices tend to feed inflation fears that eventually spill into risk assets. The timing isn't great for a market that's already sitting on its hands. The key date to watch remains July 29, when the Fed delivers its next rate decision and the market finally gets a clearer signal on where monetary policy is headed.
