Federal Reserve Chair Powell's speech at the FOMC meeting on Wednesday caused the price of Bitcoin ($BTC) to drop by 5.7%. The Chair stated that there may only be two rate cuts in 2025. This news caused all markets to fall into loss, with Bitcoin dropping to just above $100,000.
Powell's speech caused the market to crash
Wednesday's FOMC meeting concluded with Federal Reserve Chair Jerome Powell's routine speech. Powell announced a 25 basis point rate cut, and the market was prepared for it. However, as the speech continued, he indicated that there may only be two more adjustments for the entire year of 2025.
Furthermore, the latest updated dot plot shows the future rate expectations of all Fed members, which actually points to a 50 basis point rate hike.
As the news deepened, the U.S. stock market plummeted sharply, the dollar soared, and Bitcoin fell to around $6,000 that day, with altcoins generally crashing across the board.
The Federal Reserve typically has to deal with a range of issues simultaneously at some FOMC meetings, which is hard to believe. While the Fed considers rate cuts absolutely necessary, it doesn't want to let inflation run rampant again given the harsh conditions in the job market. Thus, the Fed announced a rate cut while displaying an incredible tough stance in subsequent speeches, which produced the expected effect of dampening market enthusiasm.
$BTC price has reached the bottom of the upward channel
For the price of Bitcoin, this might just be business as usual. Although the drop was very sudden and sharp, the bears have effectively managed to pull the price down to the bottom of the upward channel, and the current price is within that channel.
The price has indeed fallen 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 currently 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 upward channel.
$BTC's weekly chart shows no abnormalities
From the weekly chart, it seems that $BTC price does not show any abnormalities. Last week's hammer candle, combined with several recent downward candles, suggests that more upward movement is expected in the future.
From the bottom of the RSI chart, it can be seen that the indicator line has begun to retreat. In other words, the 70.00 level can serve as a strong support, which it has done multiple times so far.