jerome powell

Fed Rate Cut Odds Hold Firm at 87% After Powell’s “Silent” Speech, Bitcoin Bounces

In a classic case of “no news is good news,” Bitcoin found relief after Federal Reserve Chair Jerome Powell deliberately avoided all comments on the economy or monetary policy in his Stanford speech. With the Fed in its pre-meeting blackout period, Powell’s silence was expected, but it provided enough certainty for a 2% Bitcoin bounce above $87,000. Meanwhile, Fed rate cut odds continue to hover near an overwhelming 87%, fueled not by the Chair’s words, but by glaring economic weakness revealed in fresh data. The stage is now set for a pivotal December 10 decision.

Weak Economic Data Cement High Fed Rate Cut Odds

The real story isn’t Powell’s silence; it’s the screaming data. The latest ISM Manufacturing PMI came in at 48.2, marking the ninth straight month of contraction and sinking to a four-month low. This indicates slumping factory orders and rising prices—a direct result of tariffs. For the Fed, this weakens the argument for holding rates steady. Consequently, Fed rate cut odds have solidified near 87%, as the market views a deteriorating manufacturing sector as a clear signal for the central bank to provide stimulus. The potential future appointment of noted dove Kevin Hassett as the next Fed Chair only adds to the easing narrative.

Bitcoin’s Technical Rebound and Trader Sentiment

Bitcoin capitalized on the stable macro outlook, climbing to $86,970 with a daily high near $87,325. Trading volume remains elevated, showing tangible “buy-the-dip” interest. However, the derivatives market tells a more nuanced story. While total Bitcoin futures open interest rose slightly to $57.70 billion, activity was mixed across exchanges—CME saw an increase while Binance and Bybit saw declines. This suggests institutional players on regulated venues may be leading this cautious rebound. As trader Joe Saluzzi noted, the conditions support an uptrend, possibly “more of a grind up to the end of the year.”

My Thoughts

The market is trading the certainty of a narrative. Powell’s silence was a gift—it removed potential hawkish surprises. With Fed rate cut odds this high, the market is essentially pricing in the easing already. This creates a “sell the rumor, buy the news” risk for next week, but the path of least resistance until then is up. The combination of weak data and a dovish Fed setup is the perfect recipe for a crypto liquidity surge. Bitcoin is likely coiling for a significant move post-FOMC.

Fed Rate Cut Odds Hit 87.6% as Quantitative Tightening Ends, Fueling Crypto Hopes

The macro tides are turning decisively in crypto’s favor. As Federal Reserve Chair Jerome Powell prepares to speak today, the market is already pricing in a near-certain December rate cut, with Fed rate cut odds soaring to 85.4%. This seismic shift in expectations comes on the very day the Fed officially ends its Quantitative Tightening (QT) program—a major liquidity drain that has constrained markets since 2022. The convergence of these two events could reopen the liquidity faucet for risk assets like Bitcoin and Ethereum, marking a pivotal inflection point after a brutal month of selling.

Why Ending QT is a Bigger Deal Than You Think

Today isn’t just about a speech; it’s about structural liquidity. For three years, the Fed has aggressively pulled $2 trillion out of the financial system by shrinking its balance sheet—the most aggressive tightening in history. Ending this QT program tonight means the relentless drain on market liquidity is officially over. For crypto, this is potential rocket fuel. While it doesn’t immediately trigger new money printing (Quantitative Easing), it removes a massive headwind. As commentator Milk Road noted, it’s “the week’s biggest catalyst.” More dollars staying in the system increases the capital available to flow into alternative assets.

Powell’s Speech and the Path to a December Cut

Chair Powell’s speech at 8 PM ET tonight falls within the Fed’s pre-meeting blackout period, meaning he won’t directly comment on monetary policy. However, the market has already received loud signals from his key allies. Fed Presidents John Williams and Mary Daly have publicly backed a December cut, causing Fed rate cut odds to skyrocket from 40% to their current 85.4% peak. The market is clearly listening, and Powell’s mere tone tonight could reinforce or soften this overwhelming expectation. Furthermore, the potential future appointment of rate-cut advocate Kevin Hassett as the next Fed Chair adds another long-term bullish layer to the narrative.

My Thoughts

The market is often perverse. Bitcoin’s sharp drop below $90k ahead of these bullish events feels like a final shakeout. Ending QT is the true stealth catalyst—it’s the essential first step before any new easing can begin. Combined with an almost guaranteed rate cut in two weeks, the macro setup for a ferocious year-end rally is falling into place. Smart money isn’t looking at today’s price; it’s positioning for the liquidity surge that starts now. This is the calm before the storm.