A looming Fed rate hike threatens the fragile rally across Bitcoin, Ethereum and XRP. Traders raised the odds of a Fed rate hike at the September 16 meeting to 86.5%, according to the CME FedWatch tool. The shift follows fresh inflation data and puts pressure on the broader crypto market this week.
Bitcoin Faces Fed Rate Hike Pressure Before FOMC Meeting
The probability of a Fed rate hike jumped from near 70% before the August inflation report. U.S. CPI inflation rose 3.4% year-over-year in August, fueling the shift. A hike would mark the first increase in three years and signal a tighter policy stance.
Fed policymakers do not fully share this outlook, based on a recent Bloomberg survey of officials. Fewer than 13% of 48 respondents expect a rate increase at the September meeting. Most economists also see no change at the December 2027 decision either.
Bitcoin's chart structure still points toward higher levels despite the Fed rate hike concerns. Analyst Michaël van de Poppe expects a period of consolidation before the next upward push. He projects a move toward the $90,000 to $92,000 resistance zone, and bull markets typically avoid sharp pullbacks.
Ethereum Approaches $3,000 Despite Fed Rate Hike Concerns
Ethereum trades near $2,535 and faces resistance between $2,547 and $2,550. Analyst Ted Pillows notes the asset has returned to this key resistance level. A break above this zone could open the path toward higher price targets.
The next major resistance sits just above $2,800, according to Pillows' analysis. Support levels rest near $2,215 and $1,965 if the price pulls back. A weekly close above $2,550 would clear the way for further gains.
Such a close could push Ethereum toward the $3,000 mark, Pillows suggests. The Fed rate hike decision could still disrupt this trajectory in the near term. Broader risk sentiment remains tied to the outcome of the September Fed meeting.
XRP Tests Key Support Amid Fed Rate Hike Uncertainty
XRP faces a more difficult setup than Bitcoin and Ethereum right now. The token dropped nearly 20% over three weeks, falling from $1.70 to $1.35. Analyst Ali Martinez tracks this decline through on-chain and whale activity data.
Whales sold or redistributed about 90 million XRP tokens over the past week. Daily active addresses fell 90.18%, dropping from 388,492 to 38,163. This decline points to a sharp pullback in network activity and engagement.
The $1.35 level stands as a decisive support zone for XRP, per Martinez. Roughly 2.29 billion tokens already changed hands at this price point. A recovery above $1.38 could send XRP back toward $1.60 and $1.68.
The Fed rate hike remains the dominant factor shaping crypto price action this week. Borrowing costs directly affect risk appetite across digital assets and equities alike. Traders will watch the September 16 announcement for further direction on Bitcoin, Ethereum and XRP.
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