"Looking back at the last big easing cycle in 2019, the Fed cut rates three times between July and October, totaling 75 basis points. Bitcoin's initial reaction was pretty volatile. After the first cut on July 31, it dropped about 20-30% over the next few weeks before settling down."
Bitcoin has traded mostly around $80,000 in May, repeatedly rejecting near $82,000 while holding support around the upper $70,000s. Price action stays within a tight weekly range as traders react cautiously to inflation data and shifting Federal Reserve expectations. Federal Reserve policy is a key driver because liquidity conditions depend on interest rates, and high rates keep capital concentrated in lower-risk assets like bonds and short-term cash. That concentration reduces risk demand across markets, including crypto, where inflows often strengthen when borrowing costs fall. In 2019, Bitcoin’s reaction to Fed cuts was volatile, with a sharp drop after the first cut and a later rally as liquidity expanded.
#bitcoin-price-action #federal-reserve-policy #liquidity-conditions #inflation-data #market-expectations
Read at 24/7 Wall St.
Unable to calculate read time
Collection
[
|
...
]