Bitcoin trades near $80,500 ahead of Fed decision and November midterms

Bitcoin rebounded from an early Tuesday low near $79,400 to around $80,500, remaining above $80,000 before this week's Federal Reserve decision and November midterms. Bitcoin spent most of Tuesday near $80,500, with $80,000 serving as a key market threshold. Bitcoin Magazine Pro data put Tuesday's trading range at roughly $79,400 to $80,800. Bitcoin had gained about 0.3% over the preceding 24 hours by mid-afternoon Eastern time. Bitcoin stood at roughly $80,600 at the time of writing.

Bitcoin dropped below $80,000 on Monday as investors reduced risk exposure amid worries about AI-sector valuations and rising oil prices. Spot Bitcoin ETFs have also experienced outflows. However, the selling has not developed into panic. Bitcoin has largely traded between about $79,000 and $81,000 this week. Bitcoin reached an all-time high near $126,000 in October 2025. Bitcoin is roughly 30% below the price a year earlier.

The Federal Reserve meets on October 27 and 28 and will release its policy decision Wednesday. The Fed has maintained its target range at 3.75% to 4% since raising rates in September. Fed officials have indicated that another increase may be necessary before year-end. Market probabilities favored unchanged rates when last clearly reported in early October, but those readings are outdated and likely have changed. Traders will scrutinize Fed Chair Kevin Warsh's press conference for indications of a December increase.

Higher interest rates reduce liquidity available to speculative assets, so an unexpectedly hawkish decision would likely send bitcoin toward $80,000 or lower. Unchanged rates or a softer policy message could allow buyers to lift bitcoin toward the $88,000 range reached earlier this fall.

The midterm elections take place on November 3. One Polymarket reading cited in recent coverage favored Democrats taking control of both congressional chambers. The pending market structure bill is the most immediate policy issue for crypto. Lawmakers' votes on the bill could influence the crypto industry's approach to the elections. Bitcoin and other risk assets have generally risen during the 12 months following previous midterm elections.

TD Cowen analysts warned that the election outcome could delay the CLARITY Act for two years. Prediction markets assigned Democrats a 90% probability of winning the House. Prediction markets assigned Democrats a 62% probability of winning the Senate. TD Cowen described Democratic control of both chambers as the worst outcome for bitcoin. A divided Congress with Republicans retaining the Senate was considered more favorable. Republican control of both chambers was viewed as the most favorable route for crypto. The bill stalled following an unsuccessful Senate cloture vote in September. Ethics measures and stablecoin yield remain points of disagreement among lawmakers.