Bitcoin climbed above $117,000 during the early trading hours today, its strongest level since early August, as traders positioned around the Federal Reserve’s interest rate decision.
The outcome of the Federal Open Market Committee (FOMC) meeting, due later today, will define the risk landscape for the rest of the year.
Market expectations of an easier monetary policy have fueled the latest momentum.
According to a Bitwise report, softer US inflation readings have pushed futures markets to fully price in a quarter-point rate cut, with odds near 93% that cumulative cuts will reach 75 basis points before year-end.
As a result, the prospect of looser conditions has energized crypto markets, with Bitwise highlighting “a return to slightly bullish sentiment” as risk appetite in the market becomes more evident.
This position corroborates that of blockchain analysis platform Santiment, which noted that bullish optimism has surged on social channels like X.
Santiment noted that bullish commentary now makes up 64% of all crypto discussions, its highest “crowd greed” reading since July.
Moreover, stablecoin flows into exchanges also signal that real capital is on standby to capitalize on the market move.
CryptoQuant analyst Axel Adler reported that about $9 billion worth of stablecoins have entered exchanges within the last 36 hours ahead of the impending Fed meeting. This suggests that traders are prepared to act quickly on the announcement.
Caution ahead
However, despite the current bullish positions, Santiment warned that the markets often move against retail consensus, meaning that excessive confidence could expose traders if the Fed makes a surprising decision.
Blockchain analysis firm Glassnode also pointed out that the derivatives markets reflect the same tension as options traders are actively bracing for price swings.
According to the firm:
“Options traders are rapidly buying options to hedge or position for a volatility spike, reflecting the market’s uncertainty and expectation of a major move.”
Considering this, Timothy Misir, head of research at BRN, told CryptoSlate that “Bitcoin stands at a hinge point.”
According to him:
“A sustained push through $116,300 and $117,000 on Fed-driven liquidity could unlock higher bands toward $120,000. But the setup is delicate. Weak spot conviction, concentrated liquidation clusters, and heightened geopolitical risk mean the market remains one headline or one Powell remark away from snapping lower.”