Bitcoin falls toward $103,000…Uncertainty over December rate cut widens

YM Lee

Summary

Major crypto assets, including Bitcoin, were reported to have weakened due to investors' profit-taking and uncertainty over a rate cut.
The market said $100,000 acts as Bitcoin's major psychological support, and if the downtrend continues, increased volatility and additional liquidations could occur.
Expectations for a December Fed rate cut remain, but since much has already been priced in by the market, even if a cut occurs the upside could be limited.

Bitcoin (BTC) fell to near the $103,000 level on the 11th (local time) as investors took profits and uncertainty over a rate cut widened amid internal discord at the U.S. Federal Reserve (Fed).

According to The Block, Bitcoin traded at $103,222, down 3% over 24 hours, while Ethereum (ETH) was down 4.7% at $3,434, Ripple (XRP) fell 5.3% to $2.4, and Solana plunged 8.85% to $154.76.

Bitcoin briefly slid to $102,600 that day, showing weakness. The rebound from a low around $101,500 earlier this month to $106,600 was again reversed.

Vincent Liu, Chief Investment Officer at Kronos Research, said, "Bitcoin's decline was largely driven by profit-taking and large long liquidations after it failed to break the $107,000 resistance," adding, "In the short term, $100,000 will be a key psychological support level." He warned, "If the decline continues, further liquidations and increased volatility could occur."

Before this decline, Bitcoin had shown a short-term rebound on news that the U.S. Senate passed a budget bill to end the longest shutdown in history, but the recovery in risk-asset appetite did not last. Liu analyzed, "There was some macro easing expectation, but profit-taking pressure and technical weakness prevailed."

Meanwhile, market attention remains focused on whether the Fed will cut rates in December. Chair Powell recently said, "I cannot definitively say there will be a rate cut in December," and the Wall Street Journal reported that Fed members are deeply divided over whether to cut.

According to CME FedWatch, the market sees a 66.9% probability that a rate cut will be implemented at the FOMC meeting on Dec. 9-10.

Minjeong, a researcher at Presto Research, said, "If a rate cut is confirmed, risk appetite would recover and Bitcoin could attempt a new high," but added, "Because the market has already priced in about a 70% chance of a cut, even if an actual cut is decided the upside may be limited."

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