TL;DR
- Bitcoin pulls back to $113,000 after briefly touching $116,000 this week.
- Crypto market volatility increases hours before the FOMC announcement.
- Analysts see BTC at a crossroads, potentially targeting $120K or falling below $100K.
The cryptocurrency market lost momentum and ceded ground over the last 24 hours, following a start to the business week with notable optimism. Bitcoin, the main market reference, led the losses after failing to sustain itself above the $116,000 level. It’s worth noting that last Monday, October 27, the asset briefly surpassed that level, but since that peak, BTC has not been able to recover.
Several hours ago, the price experienced an abrupt drop to approximately $112,300. Although the bulls managed to temporarily defend that support and recover some lost ground, crypto market volatility is evident.
As of this writing, Bitcoin is hovering around $113,000, representing a 1.2% decrease on a daily scale. This widespread uncertainty occurs on the eve of a key macroeconomic announcement that keeps investors on edge.
The Fed’s Decision: Is a Rate Cut in Sight?
Market nervousness is directly linked to the imminent meeting of the Federal Open Market Committee (FOMC) of the United States Federal Reserve (Fed). In this meeting, the entity will decide whether to raise, lower, or keep interest rates unchanged.
The generalized expectation, as reflected in bets on platforms like Polymarket, is that the probabilities of a 0.25% cut are almost certain.
A rate cut is generally considered a bullish catalyst for risk assets like cryptocurrencies. The logic is that lower rates reduce the attractiveness of traditional financial products (like bonds), encouraging investors to seek higher returns in digital assets and fostering investment.
The market’s reaction to the official announcement will be crucial. Technical and financial analysts consider Bitcoin to be at a crossroads. Some predict that a confirmation of the cut and a favorable speech from the Fed could push the price above $120,000.
However, a negative surprise or a “sell the news” reaction could trigger a collapse below the psychological support of $100,000. This crypto market volatility is not limited to Bitcoin; Ethereum (ETH) and most major altcoins have followed the bearish trend.
BTC’s market capitalization has fallen to $2.25 trillion, and its dominance over altcoins remains stable at almost 59%, while investors await the market’s next direction.
