Expect volatilityDuring FOMC meetings, volatility tends to surge. The September 21 FOMC was the most volatile FOMC to date, as BTC saw average minutely price fluctuations of 0.81% during the press conference. FOMC days have tended to become more volatile recently. From April 2021 to January 2022, before FED’s hiking cycle, FOMC volatility was softer, reaching 0.18% during the press conference. The FOMC meetings from March to July saw higher volatility, reaching 0.33% on average per minute. The September FOMC was uniquely volatile, caused by the massively negative initial response followed by a strong recovery.
While FOMCs are notoriously volatile, they are also notoriously difficult to trade. Intraday volatility is a characteristic feature, but even the September 21 reaction retraced, and BTC experienced daily losses of -3%, but intraday high-low swings of 9%. This article is a part of the deep-dive section of our new market report: Ahead of the curve
Source: FTX API (Minutely trade data during FOMC meetings) *Dates included: 2021: Apr 28, Jun 16, Jul 28, Sep 22, Nov 3, Dec 12. 2022: Jan 26, Mar 16, May 4, Jun 15, Jul 27, Sep 21.