Bitcoin bulls are increasing long positions around $94,400 as they prepare for the Federal Reserve’s May 7 interest rate decision. The surge in futures open interest by $189 million and a 15% jump in trading volume reflect strong buying sentiment, despite some recent price dips. Historical data shows that momentum tends to slow before FOMC meetings, possibly leading to increased volatility afterward. Analysts believe potential price gains are on the horizon as the market anticipates these outcomes.
Bitcoin (BTC) enthusiasts are making their presence felt, particularly as they open long positions around $94,400 ahead of the Federal Open Market Committee (FOMC) meeting scheduled for May 7. Analyst Axel Adler Jr. has highlighted this bullish behaviour, noting that concurrent long positions have previously supported BTC, driving its price to highs of $97,500 at the end of last month.
In addition to that, Bitcoin futures open interest saw a notable uptick, growing by about 2,000 BTC, translating to an eye-watering $189 million increase just in recent hours. Despite a slight price dip, the surge in open interest and a 15% boost in trading volume underscores a convincing buying interest lingering in the market.
Interestingly, the aggregated funding rate stands on neutral ground, reflecting a balanced mood between long and short traders in the last eight-hour stretch. However, there have been fluctuations, with brief spikes reaching 0.018% on May 6, suggesting a flickering optimism among leveraged investors.
Michaël van de Poppe, founder of MN Capital, also commented on Bitcoin’s recent bounce back, envisioning a continuing upward trajectory for BTC. He hinted that the overall market conditions, particularly movements in Gold after the FOMC decision, would be crucial indicators for the prevailing business cycle.
Looking back historically, data from Swissblock, an investment management firm, indicates a pattern that Bitcoin momentum, specifically, tends to ease before significant interest rate announcements from the Fed. Their chart analysis showcased Bitcoin’s 25-day rate of change (ROC), which aligns with price movements preceding recent Fed meetings.
What’s striking is that every time the ROC increased, Bitcoin’s value tended to rise sharply, as seen in instances from late 2024 through early 2025. When the ROC dips, it’s often followed by price corrections, as illustrated in early 2025. Fortunately, the current data shows that the ROC remains on an upward trend as we step into May 2025, hinting at potential price growth for Bitcoin.
Swissblock pointed out that this FOMC meeting is critical, as the outcomes could act as a catalyst for Bitcoin’s price action, especially noting that market reactions would largely depend on the rate decision and the tone set by Federal Reserve Chair Jerome Powell.
