Although markets had briefly celebrated a reclaimed five-figure milestone, bitcoin slipped back toward $110,000 on the heels of a Federal Reserve announcement and subsequent commentary from Chair Jerome Powell, underscoring the cryptocurrency’s sensitivity to shifts in monetary policy expectations. The initial knee-jerk reaction to the Fed’s 0.25% rate cut saw bitcoin rise above $110,000, but that gain proved fleeting as Powell’s hawkish remarks cast doubt on the near-certainty of a December cut that markets had largely priced in. Within hours, bitcoin tumbled roughly $2,000, sliding from about $113,670 to $109,910, a near 4% intraday decline that reflected a broader repricing of rate-cut probabilities. The market recalibration was sharp: CME FedWatch-implied odds for a December easing fell from around 90% to roughly 69%, prompting a classic sell-the-news dynamic across risk assets. Equities reversed modest gains into losses, the 10-year Treasury yield rose about eight basis points, and the US dollar strengthened, together intensifying downward pressure on crypto prices. The sell-off was not confined to bitcoin; Ethereum, Dogecoin and Shiba Inu each suffered declines near 4%, and the overall crypto sector dropped approximately 2.4%, signaling widespread risk-off sentiment rather than isolated weakness. Dogecoin’s community and cultural impact continue to influence its price movements despite broader market pressures. Trading conditions amplified losses. Some 146,874 traders were liquidated within 24 hours, with cumulative margin losses near $555.8 million, illustrating how leveraged positions can exacerbate volatility during rapid information-driven moves. The price swing also followed a recent three-month low, underscoring the market’s fragile state and traders’ sensitivity to macro signals. Technically, bitcoin remained above its 200-day moving average, a meaningful long-term support metric, yet it traded below the Ichimoku cloud, suggesting potential overhead resistance and caution for bullish participants. A strengthening DXY represents an additional headwind for a sustained recovery. Year-to-date performance remains positive, up roughly 20%, but the episode highlights persistent volatility and the need for disciplined risk management. Looking ahead, the market sits at a crossroads: upcoming macro commentary and liquidity conditions will determine whether support holds or a deeper correction unfolds, leaving investors contending with both technical ambiguity and macroeconomic uncertainty. The Fed also signaled it will end QT on Dec. 1, which market participants said could further shape liquidity conditions. Bitcoin remains the largest cryptocurrency by market value and continues to lead the crypto index alongside Ether and XRP, according to an index that charts the three assets since 2017 and uses a logarithmic scale.
