If a FOMC Rates Cut Won’t Move Bitcoin Price, What Will?

Everyone wanted a crypto moonshot. For OG Bitcoin holders deep in green, perhaps the FOMC event didn’t matter much. However, all smart degens who bought the top, Jerome Powell, and the Federal Reserve were their only saviors. There was so much hope for the Bitcoin price to move higher until it didn’t, and as Murphy’s Law struck, the world’s most valuable crypto crashed, falling by -5% below $110,000.

The Bitcoin price, and crypto in general, is yet to recover from yesterday’s crickets. With hopes smashed, the BTC USDT price is lower from this week’s open, and the only way for a recovery is if the $110,000 level holds by the end of the day.

Before then, traders should closely monitor price action. The Bitcoin dominance is still above the +59% level as of October 30. It is likely to increase should crypto prices fail to hold the high expectations among late buyers. Meanwhile, the total crypto market cap is down nearly -2% to over $3.8T.

(Source: Coingecko)

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Jerome Powell and FOMC Slashed Rates As Expected

There was a near +100% probability of a rate cut yesterday. Everyone expected the FOMC and the central bank to ease for the second time this year. And Powell and the team didn’t disappoint.

Even with the government shutdown, the central bank slashed rates to the expected +3.75% and +4% range, another tick lower, allowing more money to flow into circulation.

Overall, the FOMC, tasked with regulating monetary policy and curbing inflation while watching labor market conditions, aimed to support employment, which, unfortunately, has been floundering in recent months.

Their decision to slash rates comes when inflation remains “somewhat elevated”, above the ideal +2% mark.

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What Happened? Why Did The Bitcoin Price Fall?

Here’s the sucker punch, though.

Although the rate cut was in alignment with the general market expectations, BTC USDT prices first rose, but that was before the Powell presser.

That’s when all hell broke loose.

During the press conference, Jerome said the FOMC remained data-dependent, as always, but a further reduction in interest rates in December is not a “foregone conclusion.”

The decision follows a split among FOMC members, with two dissents in opposite directions. The Fed chair added that the central bank will also monitor labor market changes “very, very carefully”. Nonetheless, even if there are changes for the better, they won’t rush to slash rates if inflation reaccelerates.

This statement was hawkish and bad for risk assets, mostly crypto assets, including all 100X coins.

It caught all analysts and traders by surprise because before this meeting, the probability of a December rate cut stood at over +90%. It has since fallen below +75% and will likely drop further.

(Source: CME)

The question now is: What will move the Bitcoin price?

How the crypto and some of the top Solana meme coins perform in the next few days depends on fundamental factors.

Yes, while rates are low and more easy money might find its way to crypto, the stability of the multiple deals between China and the United States will play a role.

Additionally, institutional flow via spot ETFs will determine the speed at which the Bitcoin price zooms past crucial resistance levels, presently at $115,000 and $120,000.

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