Fed's Hawkish Stance Stalls Bitcoin's Bull Run, Price Hovers Above $100K

Market Summary

The cryptocurrency market experienced a significant downturn following the Federal Reserve's latest policy announcement. Bitcoin's bullish momentum was halted as Fed Chair Jerome Powell signaled reluctance over future interest rate cuts, citing rebounding inflation indicators. Despite the setback, Bitcoin has shown resilience, managing to stay above the crucial $100,000 mark.

Key Price Movements:

• Bitcoin (BTC): Down 2% from daily open, currently trading at $100,870

• BTC/USD hit lows of $98,695 on Bitstamp

• S&P 500 and Nasdaq 100: Both down approximately 3%

External Factors:

The Fed's decision to cut the benchmark interest rate by 0.25% was overshadowed by Powell's cautious stance on future cuts. This led to a broader sell-off in risk assets, including cryptocurrencies. The CME Group's FedWatch Tool now estimates only an 8.6% chance of another rate cut at the Fed's January meeting.

Despite the current volatility, some analysts remain optimistic about Bitcoin's long-term prospects, noting that it's still up 6% for December. However, traders are warned of potential further corrections, with some predicting a larger pullback in January. The market remains highly sensitive to macroeconomic factors, particularly the Fed's monetary policy decisions.