Federal Reserve Chairman Jerome Powell's speech at the FOMC meeting on Wednesday caused the price of Bitcoin ($BTC) to drop by 5.7%. The chairman indicated that there might only be two rate cuts in 2025. This news caused all markets to fall into losses, with Bitcoin dropping to just above $100,000.
Powell's speech led to a market crash
Wednesday's FOMC meeting concluded with Federal Reserve Chairman Jerome Powell's routine speech. Powell announced a 25 basis point rate cut, and the market was prepared for this. However, as the speech continued, he stated that there might only be two adjustments for the entirety of 2025.
In addition, the latest updated dot plot shows the future interest rate expectations of all Federal Reserve members, which actually points to a rate hike of 50 basis points.
As the news deepened, the U.S. stock market plummeted significantly, while the dollar soared, with Bitcoin falling to around $6,000 that day, and altcoins generally crashing across the board.
The Federal Reserve often has to deal with various issues simultaneously in some of its FOMC meetings, which is hard to believe. Although the Fed thinks that interest rate cuts are absolutely necessary, it does not want to let inflation run wild again considering the severe situation in the job market. Therefore, the Fed announced a rate cut while demonstrating an incredibly tough stance in subsequent speeches, which created an expected effect of suppressing market enthusiasm.
$BTC price has reached the bottom of the ascending channel
For the price of Bitcoin, this may just be business as usual. Although the drop was very sudden and sharp, the bears have actually just succeeded in pulling the price down to the bottom of the ascending channel, and the current price is within that channel.
The price has indeed broken below the trend line that $BTC has adhered to since November 4, and it remains to be seen whether the bulls can regain the upper hand and push the price back above that trend line. The price is now right at the trend line, so we will either see confirmation of a breakout and rejection, or the price will break through and return to the top of the ascending channel.
$BTC's weekly chart shows no anomalies
From the weekly chart, the price of $BTC does not seem to have any anomalies. Last week's hammer candlestick, along with several recent downward candlesticks, suggests that more upward movements are likely in the future.
From the bottom of the RSI chart, it can be seen that the indicator line has begun to decline. That is to say, the 70.00 level can serve as strong support, and it has done so multiple times so far.