FED Uncertainty Dragged Bitcoin Price Below 103 Thousand Dollars

The cryptocurrency market experienced a significant decline as investors increased profit-taking and expectations for interest rate cuts in December weakened. Midweek, the price of Bitcoin (BTC) dropped by 3% to a level of $103,222. Ethereum (ETH) fell by 4.7% to $3,434, XRP declined by 5.3% to $2.4, and Solana (SOL) dropped by 8.85% to $154.76.

Bitcoin briefly fell below $103,000 to $102,600 during the day. This drop came after the cryptocurrency had recovered from $101,500 at the beginning of the month to reach $106,600. Vincent Liu, director of research at Kronos, stated that the primary reason for the decline was “profit-taking and long position liquidations following the inability to break the $107,000 resistance.” Liu mentioned that the approval of a bill by the U.S. Senate to reopen the government provided short-term relief, but it was not sufficient to balance the selling pressure.

The biggest expectation for cryptocurrency investors is an interest rate cut by the U.S. Federal Reserve (Fed) in December. However, Fed Chair Jerome Powell indicated that a cut is “not guaranteed.” The Wall Street Journal highlighted a significant division among central bank officials on this matter. According to CME FedWatch Tool data, the probability of an interest rate cut at the December 9-10 meeting is at 66.9%. Presto Research analyst Min Jung emphasized that a potential cut may not create a significant jump in prices: “A confirmed cut could boost risk appetite, but the markets have largely priced in this scenario already.”

According to market analysts, the critical psychological support level for Bitcoin remains $100,000. Therefore, investors are at risk of facing greater selling pressure if a close is made below this level.