Bitcoin Holds $112K Support Ahead of FOMC Decision

Bitcoin’s recent price action has centered around the critical $111,000-$112,000 support zone, which previously functioned as resistance before the cryptocurrency broke through to higher levels. After dipping to $112,300 earlier in the trading session, Bitcoin has recovered to trade near $113,000, demonstrating that this key technical level is now providing substantial buying pressure. Analyst Michaël van de Poppe noted that Bitcoin successfully tested lower levels and found sufficient buying interest to stage a modest bounce, though he characterized the recovery as ‘weak’ and cautioned traders about impending volatility.

The technical landscape remains cautiously optimistic as long as Bitcoin maintains its position above the $111,000 support level. The cryptocurrency continues trading above its short-term moving average, suggesting the broader uptrend remains intact despite recent fluctuations. However, analysts are closely monitoring the TD Sequential indicator, which has issued another sell signal. According to analyst Ali Martinez, previous signals from this technical tool have preceded sharp price reversals, including a recent 19% drop that caught many traders off guard.

The Federal Open Market Committee’s upcoming rate decision represents the most significant near-term catalyst for Bitcoin markets, with analysts universally warning about potential volatility spikes. Michaël van de Poppe explicitly urged traders to avoid leverage on days with major macroeconomic events, stating ‘volatility should be going up enormously today as the FOMC event kicks in.’ This caution reflects broader market concerns that central bank policy decisions could trigger sharp price movements in both directions.

Historical patterns show that Bitcoin often experiences increased volatility around FOMC announcements, particularly when interest rate decisions deviate from market expectations. The current environment combines technical uncertainty with macroeconomic sensitivity, creating conditions where rapid price swings could materialize. Traders appear to be positioning cautiously, with the successful defense of the $111,000-$112,000 support zone providing some confidence but the FOMC overhang limiting aggressive bullish bets.

Looking beyond immediate support, Bitcoin faces significant resistance between $119,000 and $120,000—a price range that previously triggered a rejection when tested. Technical analysts suggest that a clean break above this barrier would open the path toward $123,000, with Ali Martinez noting that Bitcoin must ultimately break above $120,000 to open the path toward the $143,000 region based on pricing band models. This creates a clear technical roadmap for traders watching for potential breakout opportunities.

On-chain data reveals substantial trading activity between $112,000 and $117,000, with more than 1 million BTC changing hands within this price range. This indicates strong investor interest and liquidity at current levels, with long-term holders remaining dominant despite the recent pullback. The concentration of volume in this zone suggests it represents a critical battleground between bulls and bears that could determine Bitcoin’s medium-term direction.

From a broader chart perspective, Bitcoin left a price gap around $110,900-$113,000 that was ‘partially filled today’ according to analysts. Some technical observers believe a full fill of this gap ‘would be better before markets move higher,’ suggesting potential for further testing of support levels. The current price action also fits a potential ABC corrective structure, which if validated could lead to a C-wave drop with downside targets between $97,000 and $94,000 if current support levels fail to hold.