Fed Rate-Cut Odds Reach 71%, but Bitcoin Could Drop Further — Here’s Why
Bitcoin is recovering amid rising Fed rate-cut odds, but analysts warn of a potential short-term correction due to unfilled CME gaps.Summary
Bitcoin (BTC) has rebounded nearly 8% from recent lows near $80,500, coinciding with market odds for a December Fed rate cut jumping to 71%, according to the CME FedWatch Tool. This positive shift in monetary policy expectations, coupled with significant exchange outflows suggesting short-term holder capitulation, fuels hope for a continued recovery.
On-chain data supports a potential market turning point, as massive BTC exchange outflows often precede major upward moves, and the Risk-Off Signal is declining. Furthermore, long-term holders appear to have distributed coins during strength while short-term holders are capitulating at a loss, which historically signals the later stages of a correction.
Despite these bullish indicators, analysts caution that Bitcoin could still face a short-term drop. Key concerns include an unfilled CME gap around $85,300, which historically gets closed quickly, and the risk that if BTC fails to reclaim the $88,000–$90,000 range, it could slide toward a new monthly low.
(Source：BeInCrypto)