Markets Watch Fed Tone as Crypto Trades Cautiously; XRP Leads Amid Macro Jitters

Global markets are treading carefully ahead of this week’s Federal Reserve meeting, with investors looking not for a rate cut, but for clues on future policy direction and its impact on crypto.

After Friday’s sharp $1.2 billion crypto futures liquidation—which triggered a wave of forced selling and rattled altcoins—digital assets remained subdued into the new week. While U.S. equities rebounded modestly on Monday, crypto markets continued to show signs of defensive positioning.

Among major tokens, XRP led the pack, notching modest gains as Bitcoin initially climbed above $108,000 in early U.S. trading before pulling back to $106,500 on profit-taking. A wave of renewed buying during Asia’s morning hours helped lift BTC back above $107,000.

Despite recent volatility, spot bitcoin ETFs absorbed much of the selling pressure, bringing in $1.4 billion in net inflows over the past week. Analysts point to this demand as helping stabilize BTC amid broader risk-off sentiment.

Ether (ETH) rose 1.5% to $2,609, still lagging behind Bitcoin’s ETF-fueled performance. Solana (SOL) and Tron (TRX) also advanced 1.5% and 2.1%, respectively, while overall market tone remained cautious.

Geopolitics Lift Safe Havens—but Bitcoin Stalls

Traditional safe-haven assets surged after former President Donald Trump, speaking from the G7 summit, called for the evacuation of Tehran—a statement that intensified geopolitical fears and pushed gold and oil prices higher.

Bitcoin, however, remained sluggish in response—echoing a familiar macro behavior, according to analysts.

“Bitcoin typically lags behind initial macro shocks,” said Eugene Cheung, Chief Commercial Officer at OSL, in a note to CoinDesk. “While gold and oil rally immediately on geopolitical or inflationary headlines, BTC often takes longer to respond. But if risk sentiment turns and investors seek alternative stores of value, we could see renewed BTC momentum—especially if the Fed meeting unfolds as expected.”

All Eyes on Powell and Fed Guidance

While markets widely anticipate the Federal Reserve will hold rates steady this week, the focus will be squarely on Chair Jerome Powell’s tone—particularly around inflation trends, the impact of tariffs, and hints at future rate moves.

“The Fed is in wait-and-see mode,” said Jeff Mei, COO at BTSE, via Telegram. “With inflation easing and employment strong, there’s no need to move aggressively right now. They’re likely to wait for more data before making big decisions later this year.”

Others believe the seeds of a dovish pivot may be sown, even if not explicitly stated.

“There’s potential for subtle dovish sentiment,” said Augustine Fan, Head of Insights at SignalPlus. “We’ll be watching whether the Fed uses recent downside inflation surprises and softer jobless claims to justify a shift in tone. The near-term market narrative will likely continue to focus on the Israel-Iran tensions, but the Fed’s language could shape risk appetite heading into Q3.”

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