Bitcoin has faced a sharp decline, slipping below the $100K mark today. The drop comes after Federal Reserve Chair Jerome Powell hinted at a slower pace of rate cuts in the future. Despite the setback, market analysts remain optimistic about Bitcoin’s recovery potential.
Hawkish Fed Signals Impact Bitcoin Price
The broader crypto market saw heightened volatility, with Bitcoin leading the downturn. BTC’s price decline follows the Federal Reserve’s decision to cut rates by 25 basis points, as expected. While the cut initially boosted optimism, Powell’s comments suggesting fewer rate cuts in 2025 dampened investor sentiment.
Powell indicated the Fed plans only two additional quarter-point rate reductions in 2025, down from earlier projections of four cuts. This hawkish outlook triggered selling pressure across financial markets, including cryptocurrencies.
Market Reactions and Bitcoin’s Trading Range
Bitcoin traded at $101,738 today, down nearly 3% in the last 24 hours. Trading volume surged by 22% to $95 billion, reflecting the market’s heightened activity. Over the past day, BTC’s price ranged between $98,792 and $105,302, highlighting significant market volatility.
Despite this drop, Bitcoin recently hit an all-time high (ATH) of $108,268 on December 17, showcasing its resilience.
Experts Predict a Rebound for Bitcoin
Analysts remain bullish on Bitcoin’s long-term trajectory despite the current pullback.
- Ali Martinez predicts BTC may dip to $99K before recovering. He anticipates a rally once Bitcoin surpasses $105,400, potentially eliminating bearish momentum.
- Peter Brandt is confident Bitcoin will reach $125K soon.
- Bitwise CIO suggests BTC could hit $500K if the US establishes a Bitcoin Strategic Reserve.
Market confidence has grown with reports of the US exploring a Bitcoin Strategic Reserve and similar initiatives being considered in the EU.
Short-Term Risks Remain
Experts warn that Bitcoin could face further short-term corrections. Arthur Hayes predicts potential market turbulence around January 20, during Trump’s inauguration. However, he remains optimistic about a continued upward trend for Bitcoin after this period.
Looking Ahead
While Bitcoin’s dip below $100K has stirred discussions, the market sentiment remains strong. Institutional interest, coupled with pro-crypto regulatory signals, is expected to support Bitcoin’s recovery in the coming months.
