Bitcoin could be entering a bullish phase as the Federal Reserve holds off on further interest rate hikes, according to fresh analysis.
In a recent Quicktake update, on-chain data provider CryptoQuant highlighted new supportive factors emerging for Bitcoin’s price trend.
Fed Pause Adds Momentum, Binance Data Supports Upside
CryptoQuant noted that Bitcoin has a history of performing well during periods when the Fed halts rate increases — and 2025 might offer an especially favorable setup.
During Wednesday’s FOMC meeting, the Federal Reserve opted to maintain current rates, a move anticipated by the market to hold through Q3.
“After the Fed’s decision to keep rates unchanged, Bitcoin has shown a mix of signals, particularly when looking at Binance data,” wrote analyst Amr Taha.
He drew attention to a mismatch between Bitcoin’s price stability and falling open interest (OI) on Binance — a metric reflecting the number of active derivative contracts.
“BTC has maintained steady lows just above $104,000 — a key support level that’s consistently absorbed selling pressure,” Taha explained. “Meanwhile, open interest continues to drop, indicating an ongoing reduction in leverage among traders.”
This kind of behavior — price holding steady while OI declines — is often a sign of market consolidation and can signal that a breakout is brewing.
With the Fed stepping back from aggressive policy tightening, risk assets like Bitcoin may benefit.
“The timing of this market cleanup aligns with the Fed’s pause — a macro signal that traditionally favors upside for assets like BTC,” CryptoQuant noted. “Bitcoin has often turned bullish after rate hikes stabilize, especially when paired with waning open interest and signs of exhausted sell pressure.”
Market Eyes $106K on Short Squeeze Speculation
Short-term outlooks for Bitcoin also lean optimistic, as price remains in a tight range.
According to CoinGlass data, there’s growing potential for a short squeeze — a sharp price jump triggered by short sellers being forced to cover positions — particularly near the $106,000 liquidity cluster.
Earlier assessments warned that a dip below $104,000 might trigger a sudden downward move due to deceptive order book activity (commonly referred to as “spoofing”).
Meanwhile, CoinGlass’s Derivatives Risk Index (CDRI) hovered in neutral territory, hinting at slowly increasing liquidation pressure that could erupt into more volatility.
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