Fed's Monetary Policy Shift Boosts Crypto Markets
Following yesterday's FOMC meeting, Bitcoin surged to a three-week high, gaining approximately 18% from its September lows. The Federal Reserve's decision to cut interest rates by 0.5% revitalized risk appetite, driving Bitcoin's upward momentum. Renewed ETF inflows signal recovering demand after weeks of subdued trading activity as investors anticipated the Fed's move.
Bitcoin Shakes Off Downturn Risks
Pre-meeting speculation centered on how aggressive rate cuts might impact BTC. Some analysts feared deeper cuts could reflect heightened economic concerns, potentially spooking markets and depressing risk assets like Bitcoin. However, Chair Powell's reassurances about labor market stability and his dismissal of extreme monetary easing alleviated these fears. Traders instead focused on the updated dot plot projecting 1.5% rate cuts next year—a scenario likely to sustain risk appetite unless employment data deteriorates sharply.
Trump’s Pro-Crypto Stance Adds Fuel
Beyond Fed developments, Bitcoin drew momentum from headlines featuring Donald Trump. The presidential candidate was spotted using Bitcoin to pay for a meal at a New York burger joint, reinforcing his outreach to the crypto community. This publicity stunt underscores Trump’s endorsement of Bitcoin, potentially igniting a "crypto gold rush" if he wins the November election.
Technical Analysis: BTC/USD
Bitcoin’s rally breached key resistance at 60,695, breaking the bearish trendline from July’s peak. The next targets are:
- Upside: Testing the bearish channel high at 69,355.
- Support Levels: Watch 60,695 and 57,215 for potential pullbacks.
FAQ
Q: How do Fed rate cuts affect Bitcoin?
A: Lower rates typically weaken the dollar, making alternative assets like Bitcoin more attractive as investors seek higher returns.
Q: Why did Trump’s Bitcoin payment matter?
A: It signals political alignment with crypto adoption, boosting market sentiment and speculative interest.
Q: What’s Bitcoin’s critical resistance level?
A: 69,355 is the next major hurdle; a breakout could confirm a bullish trend reversal.
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