This week, an event will take place that could significantly impact Bitcoin and the entire crypto market. It is about the press conference of Federal Reserve Chair Jerome Powell after the monetary policy committee meeting. Although the decision on interest rates is almost predictable, the real intrigue lies in how Powell will comment on it.

The status quo is already priced in. The probability that the Fed will keep rates at the current 3.5-3.75% level is about 96% according to futures contracts. This aligns with the stance Powell expressed back in December, when he said no additional rate cuts are expected until 2026. Even Neil Kashkari from the Federal Reserve Bank of Minneapolis recently stated that it is too early to cut rates again.

But here’s what really matters: will it be a hard pause or a soft one? If Powell emphasizes prolonged inflation risks, it will put more pressure on risk assets, including Bitcoin. Conversely, if he signals the possibility of further easing in the coming months, it could stimulate growth.

Morgan Stanley expects the Fed to give a dovish signal, leaving wording in the statement about considering further adjustments. This would indicate readiness for future rate cuts. Additionally, Steven Miran, appointed by Trump, is expected to oppose the pause, supporting a more aggressive 50 basis point cut. If more voices like this emerge, it will strengthen arguments for further monetary easing.

Now, to the tricky moments. Powell will likely be asked about Trump’s measures regarding housing affordability, including the purchase of $200 billion worth of mortgage bonds. ING analysts believe such measures could have an inflationary effect in the short term. If Powell recognizes this threat, it could strengthen the dollar, negatively impacting Bitcoin.

Trump’s tariffs are already seen by the market as a factor that will have a delayed inflationary impact over the year. Additionally, Powell may face questions about the Department of Justice investigation and recent bond market volatility due to Japan’s financial issues.

It is also interesting that the crypto market shows some synchronization with traditional markets. Price movements in perpetual futures over the weekend predict the direction of Monday’s opening on traditional futures with 89% accuracy. More than half of the expected price movement is already reflected in crypto before traditional exchanges open.

So, keep an eye on Powell’s press conference. Every word will matter for how the market develops in the coming months. If the tone is dovish, Bitcoin could get a boost upward. If it’s hawkish, prepare for greater volatility.