Bitcoin Enters Volatility Trap as Fed Decision, CLARITY Act and Fork Drama Converge
On Sunday, during the morning trading sessions, bitcoin exchanged hands for $64,466 on July 26, giving back most of a rally that had pushed the cryptocurrency above $66,900 earlier in the week.
The past seven days followed a familiar pattern. Buyers stepped in after last month’s drop to $57,700, driving bitcoin from $64,700 on July 19 to a high of $66,910 on July 21. Sellers then took over, pulling the price back into the low $64,000s by July 25.
Bitcoin’s market capitalization held near $1.28 trillion to $1.3 trillion throughout most of the week. The net move stayed close to flat, with bitcoin down about 1% on some weekly readings, even as the broader July recovery from the year’s low remains in double digits.
U.S. spot bitcoin exchange traded funds (ETFs) recorded net inflows exceeding $900 million over six to seven trading sessions through midweek. BlackRock’s IBIT and Fidelity’s FBTC led the buying, reversing outflows that topped $4 billion in June. The streak ended July 23, when ETFs saw about $225 million in net outflows, driven mostly by IBIT redemptions, coinciding with the start of Bitcoin’s price decline.
The Federal Reserve’s benchmark rate has sat between 3.50% and 3.75% since its last move. Traders widely expect the Fed, under Chair Kevin Warsh, to hold rates steady at the July 28-29 meeting, with hike odds around 34% in recent futures pricing. Cooler June inflation data helped fuel bitcoin’s recovery from the high $50,000s, but Brent crude prices near $90 to $100 a barrel and heavy AI-related spending by major tech companies have kept inflation risks alive.
Bitcoin charts show support building near $63,800 to $64,200, with a deeper floor at $61,800 to $63,100. The June low near $57,800 to $58,700 remains the major support. On the upside, $65,500 to $66,000 has capped recent rallies, with a bigger test at $67,200 to $68,000. A close above that zone would open the door to $70,000 to $72,000, where the 200-day moving average sits.
Daily RSI sat near 49 as of July 26, a neutral reading. The 50-day and 200-day moving averages still sit above the current price, keeping the intermediate trend pointed down. Onchain data points to accumulation beneath the surface, with several major exchanges seeing large bitcoin outflows during the week, a pattern typical of longer-term holders moving coins into cold storage.
The July 28-29 FOMC meeting is the week’s biggest event. A hold with cautious language on inflation could send bitcoin back toward $66,000 to $68,000. A hawkish surprise would likely push the price toward $61,000 or lower. Congress adds a second variable: the Digital Asset Market Clarity Act passed the House in 2025 and cleared the Senate Banking Committee, but a floor vote before the August 7 recess remains uncertain. Passage would mark the biggest regulatory catalyst of the summer for institutional bitcoin demand; a stall or failure could put pressure on BTC prices.
Traders are watching ETF flow data, Treasury yields, and the $63,800 to $68,000 range as the market heads into month end. The next few weeks are unusually crowded with catalysts: the Fed meeting, the August CLARITY Act deadline, and the possibility of two bitcoin forks arriving in the same month. When bitcoin has this many major storylines competing for attention, volatility usually isn’t far behind.