As the crypto market is experiencing a risk-off period ahead of the US Federal Reserve’s interest rate decision, speculation is rife that the Fed could cut interest rates to stimulate financial markets. Many believe the Fed will revise its 2025 interest rate forecast down to three times instead of four and could raise its growth and inflation outlook. This has led to a decline of nearly 2% in major cryptocurrencies such as Bitcoin and Ether, along with larger losses in small-cap tokens, such as Pudgy Penguins’ PENGU token, which has fallen more than 50% since the airdrop.
The market is on guard, as high expectations could lead to disappointment if the Fed’s forecast remains unchanged or inflation concerns ease. Important upcoming events also include interest rate announcements from several central banks and reports on GDP and personal income. Additionally, the low liquidity of some new tokens, such as PENGU, has led to significant trading losses.
Elsewhere, Cardano’s ADA coin is currently experiencing a decline, trading at $1,035 after falling 7.3% in the past 72 hours and 4% in the last 24 hours. Factors contributing to this downward trend include a significant drop in network activity, with active addresses dropping from 113,480 at the end of November to 73,920, and new addresses dropping from 37,890 to 24,000. Additionally, the total value locked (TVL) in Cardano has dropped by more than 27% in two weeks, affecting DeFi protocols.
ADA’s price is facing strong resistance around $1.10, with a potential breakdown if buying pressure increases. Technical analysts are divided on the price trajectory, with some concerned about the possibility of further declines if an inverted V pattern completes, which could target a drop to $0.54. Conversely, key resistance levels to watch are $1.11 and $1.32. This situation highlights the importance of thorough research before making an investment decision.
