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Just hours before the U.S. Federal Reserve’s interest rate decision today, legendary trader Michael Burry issued a warning for the financial market that could affect Bitcoin and crypto as well. The “Big Short” investor tweeted a single word today, “Sell.” Sell. — Cassandra B.C. (@michaeljburry) February 1, 2023 Burry is known for being one of the few experts who predicted the subprime mortgage crisis from 2007-2010. He shorted the mortgage bond market in 2007 by swapping CDOs and made big profits. Already on Jan. 23, Burry shared a chart of the market from the dot-com crash on Twitter and said “maybe.” He seemed to be circling a dead cat bounce, where the S&P 500 index rallied 20% over the turn of the year from 2001-2002 before falling another 30%. Today’s latest tweet can be interpreted that Burry is currently expecting a similar scenario, presumably triggered by today’s announcement of the Fed rate decision in the U.S. and the subsequent FOMC meeting where Fed Chairman Jerome Powell will talk about the latest data and expectations. Related Reading: Santiment Explains Why Bitcoin Saw A Pullback During The Past Day Given Bitcoin’s correlation with the S&P 500 and macroeconomic influence, Burry could also be sending a warning signal to crypto investors. The S&P 500 and Bitcoin have rallied sharply from their lows since inflation data has come down sharply in recent months. However, an unexpected Fed decision could be a dagger. Nevertheless, it is also important to point out that Burry has not always been right with his forecasts in the past. In fact, Burry was wrong more often than right in the past, as a Reddit user revealed. Bitcoin And Crypto Bulls Should Be Warned While a whopping 98.4% expect the Fed to continue to slow the pace of rate hikes today, according to the FEDWatch Tool, this puts the market in a vulnerable state. If the Fed does surprisingly hike by 50 basis points and expresses concerns about “sticky” inflation, it could mean a massive crash for the S&P 500, Bitcoin, and the broader crypto market. Related Reading: Bitcoin Ready To Break Trough $24K, Vital Signs Provide Clues And there are growing voices that 25 bps is not yet set in stone. According to Bloomberg, hedge funds have built up record short positions in U.S. Treasuries ahead of the FOMC meeting. They expect yields to rise, the DXY to spike and the S&P 500 to crash – which could spell doom for Bitcoin. But there are also strong voices in favor of a 25 basis point hike. Fed mouthpiece and Wall Street Journal chief economics correspondent Nick Timiraos said in a tweet yesterday that “the ECI report is helpful for the Fed, which is on track to raise rates by 25 basis points this week.” He went on to say that “a slower pace of wage growth could ease concerns that wage inflation will settle at a frighteningly high level for a central bank targeting 2% inflation.” At press time, the Bitcoin price was at $21,113, remaining relatively stable with the FOMC meeting just hours away. Featured image from iStock, Chart from TradingView.com