Bitcoin’s price is at a critical point as the market awaits the Federal Open Market Committee (FOMC) meeting. If the result is a lower basis point adjustment, BTC might undergo a correction, while a higher rate cut could boost Bitcoin. However, this boost may be short-lived.
Data from Glassnode indicates Bitcoin whales are selling off ahead of the FOMC meeting. The number of whale addresses holding over $1 million in BTC decreased, showing a sell-off of over $2 billion. This behavior signals caution and potential volatility.
For instance, Lookonchain reported significant BTC sales by whales. This defensive positioning suggests they anticipate short-term market turbulence related to the FOMC meeting.
The CME FedWatch tool shows a 69% chance of a 50 bps rate cut. Fed Chair Jerome Powell previously hinted at a rate cut, which briefly pushed Bitcoin’s price. However, the current trend suggests a bearish outlook.
Analysts like Markus Theilien from 10xResearch believe that a 50 bps cut might not offer the anticipated boost. Historically, Bitcoin’s performance post-rate cuts has been mixed.
On the daily chart, Bitcoin is struggling with the 20-day EMA, trading around $58,646. Bears are keeping BTC down, with the price below the 50 EMA, suggesting a bearish short-term trend.
The Relative Strength Index (RSI) also points to a potential correction, as it has failed to surpass the neutral signal line.
If the market remains bearish, Bitcoin could drop further, but if whales start accumulating again post-FOMC meeting, prices might rally in Q4.
Even if Bitcoin rallies after a Fed rate cut, sustainability is uncertain, with weak on-chain data and limited real activity driving momentum. Perfect timing of this rally might be crucial.
