Bitcoin Price Forecast: BTC edges down ahead Fed decision

Bitcoin price today: $104,100

• Bitcoin price edges slightly down, trading around $104,100 ahead of the Fed interest-rate decision on Wednesday.
• Ki Young Ju, founder of CryptoQuant, highlights that BlackRock’s Bitcoin spot ETF nearly doubled the AUM of its Gold ETF in under a year.
• The technical outlook shows signs of early bearish divergence in MACD, suggesting weakness in bullish momentum. 

Bitcoin (BTC) price edges slightly down, trading around $104,100 ahead of the US Federal Reserve (Fed) decision on interest rates on Wednesday. Ki Young Ju, founder of CryptoQuant, highlights that BlackRock’s Bitcoin spot Exchange Traded Fund (ETF) nearly doubled the Asset Under Management (AUM) of its Gold ETF in under a year.

The technical outlook shows signs of early bearish divergence in Moving Average Convergence Divergence (MACD), suggesting weakness in bullish momentum. 

Bitcoin sets for ideal conditions for a Santa rally, says K33 analyst

Bitcoin price reached a new high of $108,353 on Tuesday, but the daily chart closed with a doji candle, signaling indecisiveness among traders. At the time of writing on Wednesday, BTC has faced a slight decline and trades at around $104,100.

Bitcoin declines ahead of the last US Fed meeting of the year on Wednesday. A K33 "Ahead of the curve" report explains that the market expects a 25 basis points (bps) interest rate cut in Wednesday’s meeting. If this rate cut happens, total rates will have been cut by 100 bps since September. Steady economic data, combined with steady progress in rate cuts, have also resulted in heightened expectations of a Fed pause in Q1 2025.

If these projections reflect slower or fewer rate cuts next year, Treasury yields and the US Dollar will likely be stronger, making it harder for risk assets, including BTC, to be more attractive to investors.

The report further explains that after the Federal Open Market Committee (FOMC), there are no major macroeconomic releases, which creates a “Macro vacuum post-FOMC – ideal conditions for a Santa rally,” says a K33 analyst. 

This gives the market ample time to digest the FOMC and the pre-inauguration momentum to solidify. With MicroStrategy Michael Saylor’s aggressive accumulation, Trump’s inauguration nearing, and solid market conditions entering the holiday season, BTC is well-positioned to end the year on a high note.

Ki Young Ju, founder of on-chain and market data analytics company CryptoQuant, shared insights on his Twitter account on Wednesday. Ki explains that BlackRock’s Gold ETF took 20 years to reach $33 billion AUM, while their Bitcoin ETF nearly doubled gold’s AUM in less than a year. 

Another bullish outlook for Bitcoin is “Strategic Bitcoin Reserve.” 

On Wednesday, Bitcoin Magazine posted on Twitter that “Bitcoin Policy Institute drafts Executive Order for a Strategic Bitcoin Reserve for President Trump.” It needs a signature, and America’s Strategic Bitcoin Reserve is real.

“It’s becoming increasingly difficult to find reasons to be bearish on Bitcoin’s spot price,” says the QCP Capital analyst in its weekly report. 

However, the report also suggests that traders should be cautious as the options market offers a note of caution, with a continued skew toward puts over calls even as spots continue to make new highs – perhaps signaling a preference for hedging rather than aggressively chasing the rally.

Bitcoin Price Forecast: BTC price action shows indecisiveness

Bitcoin price reached a new all-time high of $108,353 on Tuesday, but the daily close showed a doji candle, signaling indecisiveness among traders. At the time of writing on Wednesday, it trades slightly down at around $104,100.

If BTC faces a correction and closes below the $101,109 daily support level, it would extend the decline to retest its next support at $90,000.

The Relative Strength Index (RSI) indicator on the daily chart reads 64 and points downwards after rejecting the overbought level of 70 on Tuesday, indicating a decrease in bullish momentum. If the RSI continues to edge down and close below its neutral level of 50, the price of Bitcoin could fall sharply. 

Additionally, the Moving Average Convergence Divergence (MACD) indicator is about to flip over a bearish crossover on the daily chart. If the MACD line closes below the signal line, it will give a sell signal, indicating downward momentum.

BTC/USDT daily chart

Conversely, if Bitcoin continues its upward trend and closes above its all-time high of $108,353, it would extend the rally to test $119,510. This level aligns with the 141.4% Fibonacci extension drawn from the November 4 low of $66,835 to the December 5 high of $104,088.

---