Amid a turbulent week in global finance, Bitcoin has taken center stage as Jerome Powell, Chairman of the Federal Reserve, issued unexpectedly cautious remarks about the outlook for US interest rates. After a second consecutive rate cut for 2025, instead of rekindling bullish sentiment, Powell’s post-FOMC conference delivered a sobering message: another cut is “far from a foregone conclusion.” In the hours after Powell spoke, Bitcoin tumbled more than 3%, falling decisively beneath longstanding support levels [source 1][source 2][source 3].
[4][6][8]Why Bitcoin Reacted Sharply
Bitcoin’s sensitivity to US monetary policy is well-documented. With the Fed trimming its benchmark rate by 25 basis points but signaling hesitancy for further easing, risk appetite faded quickly across crypto markets. Traders had priced in almost a 90% probability of a December cut, only to see those odds drop to about 70% minutes after Powell’s statement [source 2]. Many risk assets followed Bitcoin’s downturn as the US dollar and Treasury yields surged in response to the hawkish messaging.
[6]Technical Analysis: $107K Support and Market Sentiment
On the technical front, Bitcoin’s swift drop saw it approach the crucial $107,000 threshold—a price band many analysts view as the last major support before a deeper slide. Trading volume surged as short-term sellers unwound positions, with only limited bid support from longer-horizon wallets. Analysts now watch closely for stabilization near $107,000, noting that a hold above this level could invite renewed accumulation, while further breakdowns might accelerate losses toward monthly lows [source 1][source 2][source 3].
[8][4][6]Macro Outlook: Hawkish Central Bank, Cautious Crypto
The broader context for this volatility is a global market recalibrating its expectations for liquidity and risk-taking. Bitcoin and other cryptocurrencies are increasingly seen as macro-sensitive assets—reacting not just to tech-driven narratives but also to changes in traditional finance. The Fed’s reticence to signal more cuts injected uncertainty and diminished the short-term bullish case. Yet, as industry strategists argue, long-term Bitcoin demand remains supported by supply-side constraints, persistent inflation, and the asset’s appeal as a hedge against fiat turbulence [source 3][source 4].
[3][8]Is Opportunity Emerging Beneath the Volatility?
Seasoned Bitcoin analysts note that, historically, sharp interest rate moves from the Fed have often created both risk-off panic and lucrative opportunities for patient investors. As sellers test the resolve of holders and short-term volatility persists, some traders remain cautiously optimistic: macro volatility can drive new capital flows as well as rapid rebounds once monetary policy becomes clearer. For now, the message is clear—Bitcoin’s next chapter will be shaped as much by central banking rhetoric as by its internal fundamentals.
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