The US Federal Reserve (Fed) reduced interest rates as expected on Wednesday. However, only two rate cuts planned for 2025 disappointed the markets. This development led to a sharp decline in Bitcoin (BTC). After the Fed’s decision, BTC lost nearly 10% of its value.
Bitcoin Price and Technical Indicators
After the Fed’s interest rate cut decision, the price of Bitcoin dropped from $ 108,266 to $ 96,000. At the time of writing, BTC was trading around $97,500. This sharp decline signaled a new correction period in the market. The noteworthy point in technical analysis was that the 50-hour simple moving average (SMA) fell below the 200-hour SMA. This situation is considered as an indicator confirming the downward trend in the market.
However, this indicator has been known to not work as expected during some bull markets in the past. For example, during the period when Bitcoin rose from $ 70,000 to over $ 100,000 after the US elections, similar indicators signaled the end of the declines. Analysts therefore state that the latest intersection may also indicate a potential recovery.
Potential Recovery and Risks
The first target for Bitcoin’s recovery will be to reach the $100,000 level. However, there is a significant resistance at $10,600. Exceeding this level may pave the way for new records. On the other hand, a decline in prices below $96,000 may indicate that the downtrend may deepen. In this scenario, $91,000 levels may come to the fore.
Analysts recommend that investors follow technical indicators carefully. In the volatile course of Bitcoin, it is critical to take a cautious approach. The Fed’s interest rate decisions and market reactions will continue to play a decisive role in the BTC price.
Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that cryptocurrencies carry high volatility and therefore risk, and should carry out their transactions in line with their own research.
