Bitcoin Correction Deepens Ahead of FOMC

BTC Correction UnderwayThe softening in BTC over recent weeks will no doubt be frustrating for crypto bulls, on the back of what seemed like an imminent breakout earlier in the month. However, the move can still be viewed as a correction for now, despite the deep fall we saw on Monday. Looking ahead today, the FOMC will be pivotal for the path of BTC near-term.Fed Expectations & Market ImplicationsOn the one hand, with a .25% hike baked in, the Fed will likely need to strike a more hawkish tone than the market is expecting in order to drive fresh USD buying here. Given that inflation is falling steadily and with lingering recessionary concerns still on the horizon, the Fed seems unlikely to be too aggressive in its language. If the Fed is seen leaning more towards signalling a further pause after today’s hike, this would be enough of a catalyst to drive BTC higher near-term, with USD coming under heavy selling pressure. However, if the Fed is seen pointing to the likelihood of further rate hikes near-term, retaining caution around its CPI outlook, then this should see USD remain underpinned, weighing on BTC near-term.Technical ViewsBTCThe reversal lower from the 32185 level has seen BTC falling back below 3000 for now. This is a key psychological level and, while below here, risks are tilted towards a further move lower and a test of the 27415 level next, in line with bearish momentum studies readings. Should bulls find their feet today, 32185 remains the key near-term hurdle to overcome.