Bitcoin price holds above $65K as Fed rate decision, ETF flows shape market outlook

Bitcoin price is holding firm above the $65,000 mark as attention shifts from geopolitical headlines to one of the biggest events on this week's economic calendar.

After recovering from recent volatility, the world's largest cryptocurrency is trading in a relatively tight range while market participants wait for the US Federal Reserve's interest rate decision and fresh guidance on monetary policy.

The latest price action reflects a market that has regained some confidence after a period of uncertainty.

But at the same time, institutional fund flows and broader macroeconomic developments continue to influence sentiment, leaving traders cautious ahead of the next major catalyst.

Bitcoin steadies above $65,000 after recent recovery

Bitcoin has climbed back above $65,000 following a period of weakness that saw the asset trade below that level earlier in the month.

Over the past 24 hours, the cryptocurrency has posted a gain of around 1%, trading between roughly $64,870 and $65,653.

Notably, the recovery has extended Bitcoin's positive momentum over longer timeframes, with gains of about 2% over the past week, nearly 4% over the last two weeks, and more than 8% during the previous 30 days.

But despite those gains, Bitcoin remains below its 2025 record high of more than $126,000.

The correction has left the asset down roughly 25% this year, highlighting that the current recovery is taking place within a broader period of consolidation rather than a full return to last year's peak.

The rebound, which has also been witnessed on other coins like Ethereum and XRP, has been supported by improving risk appetite across global financial markets.

Investor sentiment improved after tensions between the United States and Iran eased, reducing concerns over potential disruptions to global energy supplies.

As a result, oil prices fell by about 5%, easing inflation concerns and encouraging investors to return to higher-risk assets, including cryptocurrencies.

Federal Reserve decision becomes the next major catalyst

While geopolitical developments helped lift sentiment, attention has now shifted to the Federal Reserve.

Financial markets widely expect policymakers to leave interest rates unchanged at the upcoming Federal Open Market Committee meeting.

However, investors are focusing less on the rate decision itself and more on what Federal Reserve Chair Kevin Warsh says about inflation, economic growth, and the path of future monetary policy.

Any indication that interest rates could remain elevated for longer may reduce demand for risk assets, including cryptocurrencies.

On the other hand, comments suggesting that inflation is moving closer to the Fed's target or that policy easing could become possible later this year may provide additional support for Bitcoin.

In addition, the Fed meeting comes during a busy week for financial markets, with earnings reports from several large US technology companies also expected to influence investor sentiment.

Because cryptocurrencies have increasingly moved in line with broader risk assets, developments in equity markets could also affect Bitcoin's short-term direction.

Bitcoin ETF flows reflect growing investor caution

Another closely watched indicator is the performance of US spot Bitcoin exchange-traded funds.

After recording seven consecutive sessions of net inflows, spot Bitcoin ETFs recently experienced more than $465 million in combined net outflows over two trading sessions, according to Coinglass data.

The change suggests that some institutional investors have reduced exposure ahead of the Federal Reserve meeting rather than making aggressive directional bets before policymakers announce their decision.

Even with those outflows, Bitcoin has continued trading near $65,000, indicating that selling pressure has so far been absorbed by broader market demand.