Overview

Bitcoin (BTC) is currently facing some downward pressure after showing indecisive behavior characterized by a Doji candle pattern observed on Tuesday. This trading behavior likely reflects traders' attempts to de-risk in light of an anticipated hawkish approach from the Federal Reserve regarding interest rates.

Currently, Bitcoin's price is hovering around $103,750, down approximately 2% for the day as per data from TradingView and CoinDesk. Following a record surge to over $108,000 on Tuesday, it could not sustain its gains, concluding the UTC day nearly flat. This resulted in the formation of a 'Doji', which signals uncertainty in the market, often suggesting exhaustion in bullish trends when it appears at peak values.

Key Points:

• Bitcoin's decline is affecting altcoins significantly, though some major cryptocurrencies like XRP, SOL, and ETH are seeing losses similar to BTC.
• The Federal Reserve is set to announce its rate decision along with projections and forecasts at 14:00 ET, followed by a press conference with Chair Jerome Powell thirty minutes later.
• The expectation is for a 25 basis points rate reduction, bringing the rate to the 4.25%-4.5% range, culminating in a total reduction of 100 basis points since September.

Analyst Insights:

• Analysts at ING commented, "The risk of slightly stronger near-term growth with the threat of higher inflation means that we expect them to signal only three rate cuts in 2025, a downward revision from four."
• They further noted, "We anticipate 25 basis points cuts each quarter in 2025, leading to a target rate of 3.75% by the third quarter."

Conclusion

While the market appears to be bracing for possible rate cuts, the potential for economic easing remains an option, suggesting that the general sentiment for risk assets could still be upward.