Market Prepares for Shift in Fed Policies at Crucial Support Level

As traders interpret Fed indicators and a slowdown in accumulation, Bitcoin’s ascent has encountered a temporary hurdle, eyeing a target of $110,000.

Current BTC Price Situation

The forecast for Bitcoin’s price is complicated in this context, as the market anticipates today’s FOMC decision and investors seek to align their price expectations accordingly.

Catalyst

This week started off rainy, with anticipated realized profits of about $3 billion on August 16 leading to a swift approximately 1.9% decline to around $114,707. This period’s crypto news covered identified negative macro sentiment and profit-taking as contributing factors.

Support Focus

The cost-basis distribution from Glassnode indicates a significant cluster at around $116,963 (representing roughly 3.6% of the supply). If this range isn’t maintained or reclaimed, the chances of a liquidity sweep down to about $110,000 become more likely before stronger bids arrive.

Accumulation

Glassnode’s Accumulation Trend Score has cooled from approximately 0.57 to 0.20, suggesting weaker demand from HODLers in this pullback (indicating more redistribution than accumulation at current pricing).

Critical Indicators: Fed Chair Uncertainty Impacts BTC

Indicator 1 – Profit-Taking and Diminished Accumulation Weaken Support

Profit-taking and ETF outflows have pushed Bitcoin down to the $113–$115K range, as noted by crypto.news; Bitcoin’s price prediction reflects lower accumulation, which undermines immediate spot support.

Indicator 2 – September Rate-Cut Odds Decline

CME FedWatch probabilities have also changed, with polymarket pricing for a September cut recently dropping from approximately 80% to about 70%. The narrative of a “macro tailwind” for Bitcoin is weakened by a lack of confidence in short-term easing.

Indicator 3 – Trump’s Potential Powell Replacements Create Policy Uncertainty

Recent reports cover numerous potential successors to Powell and scenarios where a replacement is debated versus Powell remaining; these mixed signals heighten policy uncertainty and risk premiums for duration-sensitive assets like BTC.

Implications of Fed Chair’s Policy on BTC Price Predictions

Base Scenario (Choppy, Cautious)

The latest chart outlook suggests Bitcoin will likely fluctuate between $110,000 and $120,000, with $116,963 as a pivot point, provided that cut odds remain low and speculation surrounding the Fed chair persists. Traders seeking liquidity and fading breakouts are likely to witness whipsaws around this level.

Bullish Scenario (Clarity and Easing)

If $116,963 is reclaimed and sustained, clear guidance about easing in September and November, along with diminished replacement chatter, could reignite flows and set the stage for a retest of $120K–$124K (previous ATH region).

Bearish Scenario (Liquidity Grab)

On-chain weakness combined with the projection of order-book gaps suggests a stop-run towards approximately $110,000 (or even $108K in a more significant drop) if cut odds worsen and uncertainty about the chair increases.

Summary: Interpreting Bitcoin’s Current Price Action

Monitor any reclaims and acceptance above approximately $116,963 on volume; long-term acceptance supports upward movements. Rejections or unsuccessful reclaims open up $112K to $110,000.

Watch for accumulation indicators (specifically Glassnode’s Accumulation Trend Score) to signal a potential reversal; a rise above 0.20 would be beneficial.

Stay attentive to news regarding Powell and shifts in rate-cut odds, which are critical variables influencing risk appetite over the next two to four weeks.