Bitcoin gave up much of its recent gains on Thursday, dipping to $63,964 after the U.S. Federal Reserve held rates steady but indicated it could maintain a tighter monetary policy approach through the rest of 2026.
Fed guidance shakes investor expectations
The leading cryptocurrency slid 2.8% in early trading, reflecting a shift in sentiment following updated guidance from the Fed. While the rate decision itself was in line with forecasts, investors refocused on the possibility of at least one 25 basis-point rate hike by year-end as persistent inflation pressures took center stage.
Fed Chair Kevin Warsh remarked that rather than offering strong forward guidance on future rate moves, the central bank would respond more closely to economic data going forward and remains committed to bringing inflation back down to its 2% target.
Higher interest rates typically curb appetite for riskier assets, which weighed on bitcoin despite some recovery seen elsewhere in markets. According to CME FedWatch data, there is now a stronger expectation of a quarter-point hike before the end of 2026.
Risk appetite lifts, but digital assets struggle
Market sentiment improved globally after reports that indirect U.S.-Iran talks had yielded a framework peace agreement aimed at restoring access to key maritime trade routes. This news briefly fueled greater risk-taking among investors worldwide.
However, artificial intelligence and semiconductor stocks led the rally, while digital assets like bitcoin remained under pressure, delivering a weaker performance than other risk categories in this period.
200-week moving average holds as key support
Bitcoin is currently trading just above its 200-week simple moving average, a long-term technical level that now sits around $62,358. Over the past two weeks, the price dipped briefly below this threshold, but has consistently closed back above it on a weekly basis.
Mini glossary: The 200-week simple moving average is a long-term technical indicator reflecting the average of a given asset’s closing prices over the past 200 weeks. It’s often monitored as a major trend or support benchmark in markets.
Thomas Perfumo, Chief Economist at Kraken, noted that weekly closes below this average have been rare since mid-2017. Data from Perfumo show that buying during these brief dips has historically netted investors a median return of 113% after one year and 313% after two years.
| Indicator | Level or result |
|---|---|
| Bitcoin price | 63,964 dollars |
| 200-week moving average | 62,358 dollars |
| Median 1-year return | 113% |
| Median 2-year return | 313% |
Perfumo also pointed out that the median time for buyers to break even when entering below this marker has historically been just two days, with the maximum median drawdown over the following 12 months limited to about 9%. Kraken is one of the largest global cryptocurrency exchanges.
According to Kraken Chief Economist Thomas Perfumo, periods when bitcoin trades below its 200-week average have been rare, and those who bought at these levels have seen striking gains in past market cycles.
On the other hand, analyst Ted Pillows presented a more cautious perspective, suggesting that bitcoin could form a lower peak in the latter half of 2026, potentially triggering a sharper selloff. This outlook contrasts with the historically positive trend seen when buying near the 200-week moving average.
While bitcoin’s long-term technical supports remain intact for now, shifting monetary policy expectations and evolving global risk sentiment continue to set the pace for digital asset prices.
