BTC Volatility Analysis for Fed Interest Rate, 31st July 2019

Data Analysis

The release

Released by the Federal Open Market Committee on 31 July 2019 at 2:00 PM EDT. The Federal Open Market Committee cut its target range for the federal funds rate by 25 basis points, to 2.00–2.25%.

How Bitcoin moved

Bitcoin was at $10,024.48 when the figure came out. Fifteen minutes later it was 0.39% lower, and an hour later 0.5% lower. Its high-to-low range in the hour after was 0.91% of its price, against 0.92% in the hour before.

Measured by Clometrix

Bitcoin's volatility ratio was 2.72x, against 4.29x for a typical Fed Interest Rate release since 2021. Its volume ratio was 2.66x, against a typical 5.81x. That is a muted reaction by this release's own standard. Both compare the quarter hour of the release with an ordinary quarter hour that same day, where 1.00x is no change: volatility is how far the price ranged, volume how much traded.

What made it matter

Since 2021, Fed decisions that changed the rate have moved Bitcoin more than those that held it: a median volatility ratio of 5.37x across 18, against 3.31x across 28. This one changed the rate. Its own ratio of 2.72x compares with 5.37x for those, so it moved the price less than its circumstances would suggest.

Its record

Across 46 Fed Interest Rate releases since 2021, Bitcoin's median volatility ratio is 4.29x.

About Federal Reserve Interest Rate Decision

The Federal Open Market Committee (FOMC) has eight regularly scheduled meetings each year, but they can meet more often if the need should arise. The meetings are not held in public and are therefore the subject of much speculation on Wall Street, as analysts attempt to predict whether the Fed will tighten or loosen the money supply with a resulting increase or decrease in interest rates.