Bitcoin (CRYPTO: BTC) remains in a holding pattern ahead of the most anticipated Federal Reserve interest rate decision in months.
What Happened: Prominent technical analyst Kevin explained noted that BTC is currently within the $106,800–$118,300 range, holding a daily downtrend with highs at $125,000, $117,400, and $116,800.
The Fed is expected to deliver a 0.25% rate cut, but the tone from Powell will be decisive.
A dovish outlook with a cut could benefit BTC, while a hawkish stance might weigh on sentiment.
Breaking above $120,000–$125,000 is crucial to negate weekly and monthly reversal signals, and a monthly close above $125,000 is required to avoid confirming a macro top.
BTC also faces a bearish divergence forming since March 2024.
Also Read: Bitcoin, Ethereum, Dogecoin Consolidate As XRP Tries To Push Higher
Why It Matters: Kevin highlighted that the total crypto market capitalization sits at $3.95 trillion, roughly 9% below its fair value regression band of $4.32 trillion.
Historically, major rallies begin only once market cap breaks above this band, which hasn't occurred this cycle.
The subdued performance is largely attributed to the Fed's strict monetary policy — high rates above 4.5% and aggressive balance sheet runoff (QT).
Lower rates and an end to QT are seen as essential to unlock liquidity and fuel the next major crypto rally.
Castillo Trading noted that minor BTC or ETH moves can wipe out 10%+ and capital continues rotating among short-term movers with little sustained strength.
Many traders appear frustrated despite strong year-to-date performance — Bitcoin +73%, Ethereum +250%.
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