Bitcoin Drops Below $63,000 on Fed Rate-Hike Fears, Hits Lowest Since July 16

Bitcoin fell below $63,000 as concern mounted that the Federal Reserve may raise interest rates, sending the cryptocurrency to its lowest level in 11 days.

Bloomberg reported on July 27 that Bitcoin dropped as much as 2.3% during the session to $63,414. Ether also fell 3.6%.

The weakness in digital assets appears to reflect growing caution that the Fed could raise its benchmark rate this week. Citadel Securities expects the central bank to lift rates by 0.25 percentage point on Wednesday. Markets are pricing in roughly a one-in-three chance of an increase at this meeting.

"Bitcoin is under pressure as the likelihood of a Fed rate hike has increased, while broader macroeconomic concerns over AI-related credit risk are adding to the strain," Caroline Mauron, co-founder of Orbit Markets, said. "On the downside, $62,000 is the next level to watch, while strong support is expected around $60,000."

Bitcoin has shown a gradual recovery over the past month after plunging about 50% from its all-time high of $126,000 in October last year. Still, that rebound is coming under pressure again after heavy outflows from US spot Bitcoin exchange-traded funds last week.

US spot Bitcoin ETFs recorded net outflows of more than $465 million on July 23 and July 24, ending a seven-session streak of net inflows.

Tony Sycamore, an analyst at IG Australia, said he remains neutral on Bitcoin. For medium-term downside risks to ease and for the technical picture to turn more constructive, the cryptocurrency needs to break decisively above its 200-day moving average, now at $72,001, and close above that level.