Bitcoin's Response to Fed Policy: A Bearish Trend Unveiled
Bitcoin's reaction to the Fed's policy updates has become a fascinating and consistent market phenomenon. After each FOMC announcement, the world's leading cryptocurrency experiences a notable decline, highlighting its close connection to interest rate expectations and broader macroeconomic sentiments.
But here's where it gets controversial... While the Federal Reserve is transitioning from its 2021 liquidity settings to a more supportive stance in 2025, the immediate impact on markets is not guaranteed. Bitcoin's post-FOMC meetings drop in 2025 is primarily a strategy to liquidate long positions.
According to CryptoMichNL, an expert analyst, the real market movement and direction are expected within the next 1-2 weeks, offering a clearer outlook for 2026. Despite the recent pullback, the bullish trend remains intact, and the thesis is still valid. The key level to watch is the $92,000 resistance zone; a breakthrough here could lead Bitcoin to retest the $100,000 level.
Bitcoin's price action has been choppy, influenced by illiquid order books and rapid moves in both directions. However, CryptoMichNL highlights an upcoming upward breakout, suggesting that the recent volatility is building an upward structure, with BTC forming higher lows.
And this is the part most people miss... The heavy correction in the market was not organic but highly manipulated, according to CryptoMichNL. As the price stabilizes, the market is expected to return to a more natural state.
Why is Bitcoin's market structure resilient despite a deep pullback? Daan Crypto Trades, a full-time crypto trader and investor, explains that the initial bounce from the 0.382 Fibonacci retracement level is a key indicator. This level, derived from the entire cycle move, represents the lowest price point without breaking the broader weekly market structure.
According to Daan, the November lows would be an uncomfortable position for bulls, and the higher-timeframe outlook is the key to invalidating the current cycle. As we approach the end of the year, the 4-year cycle selling should diminish, making Q1 2026 a critical period to determine Bitcoin's next cycle move.
So, what do you think? Is Bitcoin's market structure truly resilient, or are we missing crucial signals? Share your thoughts and let's discuss!
