Crypto traders cut exposure across derivatives venues before the Federal Reserve's July 29 rate decision, with the FedWatch tool splitting 64.2% for no change against 35.8% for a 25 bps hike. Bitcoin's 7-day taker position sank to -3.43, its lowest in a year, while whale stablecoin inflows to Binance sit far below their September 2025 level.
Crypto traders pulled leverage out of the market before the Federal Reserve announces its interest rate decision on Wednesday, July 29. According to the FedWatch tool, there is a 64.2% probability that rates stay flat and a 35.8% probability of a 25 bps rate hike.
The Kobeissi Letter observed that this makes for some of the most divided market expectations regarding a rate decision in recent history. In a post on X, the global capital markets commentary wrote that "Fed Chair Warsh has effectively eliminated forward guidance", which added to the market uncertainty. Most of the market appeared prepared for a decision of no rate hike.
Sell orders take over as traders turn defensive
Bitcoin is down 3.10% over the past week but has rallied 2.10% over the past 24 hours. On Tuesday, July 28, the Bitcoin price dived to a local low of $62.7k.
The 7-day taker position sank to -3.43, the lowest in a year. This meant that market sell orders had seized considerable dominance in the latest trading period, and that sell pressure came ahead of the FOMC decision. Therefore, the intense bearish taker activity signaled defensive positioning ahead of the decision, and might not dictate the next move's direction.
Crypto analyst Amr Taha also observed that the derivatives market underwent a broad leverage reduction on July 28. Gate.io saw a $391 million reduction, almost half the decline. Bybit and Binance recorded Open Interest declines of $178 million and $149 million, respectively, with traders reducing exposure across exchanges, the analyst concluded.
Whale stablecoin inflows stay far below last year's peak
Since September 2025, stablecoin inflows to Binance from whales have shrunk from $63 billion to $25 billion, demonstrated analyst Darkfost. The inflows briefly recovered after the Bitcoin price reached $60k in February, but that recovery was not sustained, which underlined the weakness in whale demand.
The Bitcoin price trajectory also remained bearish, and the 4-hour timeframe's swing structure was bearish. The losses of the past week and the inability to convincingly flip the 78.6% retracement level at $65.2k to support were factors that showed bears have the upper hand in the short-term.
A rally beyond $67.2k is needed to flip that structure bullishly.
Source: AMBCrypto
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