Bitcoin in 72-hour danger zone as historic Supreme Court battle and Fed decision both threaten to weigh on dollar

Bitcoin has entered a 24-72 hour window in which the Federal Reserve’s message, dollar pricing, and the Supreme Court’s active test related to the Federal Reserve’s independence may define the near-term regime that traders apply to this asset.

Fed decisions and short-term market regime

As of the morning of January 28th, the market is awaiting the Fed’s first policy decision of 2026. According to the Fed’s January 2026 calendar, the January 27-28 meeting will conclude later today with a policy statement scheduled for 2:00 p.m. ET and a Chairman’s press conference scheduled for 2:30 p.m. ET.

The Board also posted advance notice of a closed meeting scheduled for January 27 at 10 a.m., with an agenda item entitled “Discussion of Monetary Policy Issues.”

Timing details are highlighted in RatePass communications ahead of the statement, as shown in the Fed Board’s closed meeting notice.

In parallel with the Fed window, the Supreme Court heard arguments in Trump v. Cook (25A312) on January 21st. The case, described by the Associated Press as a test of the Fed’s independence, is expected to be decided by early summer.

The case is tracked in the Supreme Court’s docket, and related proceedings can be viewed on the court’s oral argument audio page.

Cornell University’s Legal Information Institute summarizes that the dispute is about whether the dismissal met procedural requirements and whether it was done for sufficient cause, a framework that markets have treated as being relevant to central banks’ insulation from politics.

A summary can be found on the Cornell LII case page for 25A312.

A story of dollars, yields and hedging

The currency background is already in motion. The US dollar index fell to 95.86, the lowest level in four years.

In a report on the dollar’s widening decline, the Wall Street Journal linked the decline to policy uncertainty, including concerns about confidence and central bank independence.

When it comes to interest rates, the clearest scoreboard for Bitcoin over the next few sessions lies in the decomposition between real yield and inflation compensation.

This split could determine whether markets treat Bitcoin as an interest rate-sensitive risk or a hedge tied to policy credibility.

According to FRED’s 10-year real yield series, the monthly reading for December 2025 is 1.90%.

This measurement, shown in the FRED Series FII10, is a reference point that traders often use as a basis for determining whether real rates are tight enough to limit long-term exposure.

FRED’s 10-year breakeven inflation rate was approximately 2.31% to 2.34% for the period ending in late January 2026, including 2.33 on January 20th and 2.34 on January 21st.

The daily table is available from FRED’s T10YIE data and allows you to check in the short term whether changes in nominal yields are driven by real yields or inflation expectations.

Gold was also part of the same narrative channel as the dollar. The Financial Times reported that gold has climbed above $5,300 an ounce on the back of a weak dollar and safe-flight behavior.

This cross-asset comparison, described in the FT report, is important in determining whether Bitcoin is co-trading with hedging products or equities.

The transmission mechanism for identifying Bitcoin now includes an ETF wrapper, allowing net flow totals to verify, rather than explain, what macro regime will take hold after the Fed’s communication.

Live data for the ETF shows that the initial two-day rally (+$1.59 billion on January 13-14) has been steadily unwound by sustained outflows, with 7 of 12 sessions being negative, highlighted by -$708.7 million on January 21, and down about -$298 million over the period (about -$1.76 billion from January 15).

Review checklist for the next few sessions

For traders tracking this cluster, the question is how to categorize Bitcoin’s identity once the Fed sets its short-term reaction function and the institutional risk story continues to come into view through the Supreme Court timeline.

One way to formalize a watch list is to lock the next 24 to 72 hours onto a dial that can be monitored and seek confirmation from correlations that can be seen in real time rather than explanations that cannot be seen in real time.

There are three possible analytical paths to what constitutes confirmation after the Fed’s statement and press conference.

In the “hawkish hold” path (analysis), traders seek flat-to-lower breakeven points while real yields hold or rise, a combination consistent with tougher conditions.

They will then check whether Bitcoin weakens with its real yield movement and whether the US Spot Bitcoin ETF’s net flows weaken in its next print issue.

For related context on liquidity and flows, see igcurrencynews’s article on Spot Bitcoin ETF Flows.

The “dovish hold” line (analysis) will check whether real yields fall and the dollar declines further, and whether Bitcoin’s strength matches that combination.

Traders also expect the total ETF flows to be positive when the far side posts a numeric line instead of a dash.

In the “independence – risk premium prevails” path (analysis), the focus shifts to whether the dollar remains under pressure and whether gold remains under bid within the WSJ confidence framework.

From there, the test becomes whether Bitcoin co-moves with gold more often than it co-moves with rate-sensitive risk during the same session. Dynamic CoinDesk discussed it in the context of the “digital gold” narrative.

The Supreme Court’s timeline keeps systemic risk discussions in the background after the Fed’s Jan. 28 press conference, as the Associated Press reported a decision is expected by early summer rather than immediately.

As the Journal writes, that horizon could become important in positioning if markets continue to associate dollar weakness with concerns about central bank independence.

In that case, the link will push more price discovery into FX and hedging than a single data point.

Longer-term reference points also shape the way some desks construct hedge comparisons, but they are models rather than commitments.

JPMorgan strategists compared Bitcoin to gold on a volatility-adjusted basis and found that Bitcoin’s theoretical price would be close to $170,000 over a six- to 12-month period, Business Insider reported.

This model is explained in a report by Business Insider, and is a number that traders can use as a guardrail in determining how much gold-style regime shifts are already priced in.

As of 8 a.m. ET on January 28, this week’s tape actionables remain time-stamped and measurable. Namely, the Fed’s 2pm ET statement and 2:30pm ET press conference later today, the already discussed Supreme Court case that the Associated Press says will be decided by early summer, and the DXY level mentioned in 95.86.

The same checklist includes gold trades over $5,300 per FT and the next published far-side ETF net flow totals.

For related igcurrencynews articles on the Fed-led tape, see how Bitcoin reacted to the Fed’s signals on quantitative tightening and how BTC moved with the dollar weakness.