Bitcoin Rally Expected to Resume After Fed Minutes-Triggered Dip

Bitcoin and the broader crypto market experienced a slight pullback after the release of the Federal Reserve’s May meeting minutes, but analysts say the rally isn’t over. With strong institutional demand, steady ETF inflows, and corporate interest building, the outlook for Bitcoin remains bullish.

Fed Minutes Trigger Brief Dip

The May 6-7 FOMC minutes underscored a hawkish stance on inflation, with officials warning of “difficult tradeoffs” in managing persistent price pressures and potential recession risks. The language suggested a cautious approach until the economic effects of ongoing policy shifts become clearer.

Bitcoin slipped below $107,800 on the release but has since rebounded to around $108,500. Other major cryptocurrencies like Ethereum showed resilience, closing in green around $2,711. Altcoin performance was mixed: XRP and Solana saw slight losses, while Dogecoin held steady, contributing to stability in the GMCI 30 Index.

Analysts: The Rally Isn’t Over

Despite the dip, analysts at BRN and other firms maintain a bullish outlook for Bitcoin and crypto markets. Here’s why:

• Institutional Demand is Strong: U.S. spot Bitcoin ETFs have seen 10 consecutive days of inflows, with BlackRock leading the charge.
• Corporate Adoption Grows: Companies like Trump Media, GameStop, and Strategy are adding Bitcoin to their treasuries, with Trump Media announcing a $2.5 billion Bitcoin treasury strategy.
• Profit-Taking is Controlled: Glassnode data shows rising profit realization but not at extreme levels that signal a market top.

In a report, Glassnode analysts wrote, “As price rallied through the previous all-time high, a notable uptick in profit-taking was recorded, with only 14.4% of days recording higher values. This suggests profit-taking has increased but has not yet reached extreme levels.”

Key Macro Catalysts Ahead

Traders are closely watching the upcoming U.S. Personal Consumption Expenditures (PCE) report, the Fed’s preferred inflation gauge, as a potential market mover.

• A Softer Inflation Print: Could ease the Fed’s inflation concerns and spark optimism for a rate cut, adding fuel to the crypto rally.
• A Hotter Reading: May prompt a risk-off mood and lead to outsized price reactions, even with minor data surprises.

Dr. Kirill Kretov of CoinPanel notes, “Given the fragile structure of crypto liquidity, expect outsized price reactions either way, even if the data only misses or beats by 0.1%.”

Final Thoughts

While Bitcoin and crypto markets experienced a brief pause following the Fed minutes, the structural backdrop remains bullish. With institutional inflows holding firm, corporate Bitcoin treasury strategies taking shape, and traders eyeing key macro data, the stage is set for the rally to resume.

For now, Bitcoin’s position above $108,500 and Ethereum’s move past $2,700 highlight the resilience of the market—suggesting that, once the dust settles, the bulls could be back in control.