Bitcoin [BTC] Remains Resilient Amid Mounting Pre-FOMC Tension

Bitcoin [BTC] remains resilient amid mounting pre-FOMC tension, defying broader market hesitation as traders brace for Federal Reserve Chair Jerome Powell's upcoming policy update.

Bitcoin [BTC] is showing surprising resilience amid pre-FOMC tension, defying broader market hesitation as traders await Federal Reserve Chair Jerome Powell’s upcoming policy update.

While interest rates are expected to remain unchanged for now, analysts at Delta Exchange anticipate a short-term correction within the next 48 hours.

However, in a broader perspective, Bitcoin’s sustained outperformance of both gold and the S&P 500 over the past month is reinforcing a growing “up-only” narrative, hinting at deepening investor confidence even in a cautious environment.

Since the 1970s, every time the real federal funds rate has exceeded the natural rate of interest significantly, the U.S. economy has either entered a full recession or experienced a growth slowdown.

The chart below, based on Jim Paulsen’s analysis, highlights this pattern with striking clarity.

Currently, the real rate is well above the neutral rate, mirroring past peaks that came before economic downturns.

Source: X

President Trump is urging the Federal Reserve to cut interest rates, but the central bank seems set to hold steady at its meeting on the 7th of May.

Officials are approaching the decision cautiously, considering conflicting economic signals—a Q1 GDP contraction against strong April job numbers.

However, with Trump’s tariffs adding new inflationary pressures, the risk of delayed easing may increase.

Is Bitcoin the new safe haven?

Amid rising uncertainty and Fed policy paralysis, Bitcoin continues to outperform traditional assets. BTC surged over 7% in April, outpacing both gold and the S&P 500, the latter of which remained in the red for much of the month.

While gold experienced a modest gain of nearly 5%, Bitcoin’s rally is noteworthy and suggests a growing shift in investor behavior.

Source: Crypto Rank

With recession risks rising and equities struggling, some capital that would typically flow into gold or defensive stocks appears to be flowing into Bitcoin.

If rate cuts do materialize later this year, BTC could see renewed upside momentum as liquidity returns and risk appetite broadens.

BTC market positioning: “Up-Only” returns or just a pause?

Bitcoin remains technically sound despite light selling pressure ahead of the FOMC. According to analyst Michael Van De Poppe, BTC is holding up “nicely” and may be forming a bottom, with the lowest point possibly arriving today or tomorrow.

The attached chart shows liquidity clustered around the $61.5K-$62.5K range; marked as a crucial re-entry zone if Bitcoin dips further.

Source: X

After a strong rally in late April, BTC has entered a period of consolidation, a common occurrence ahead of major Fed announcements.

Despite this, the broader trend remains intact, and market sentiment is shifting toward a potential easing cycle. If the stars align, the “up-only” thesis could regain momentum quickly.

If Bitcoin manages to stay above the green zone, bulls could take the lead and push for a continuation of the upward move.