Powell's silence on rates to fuel Bitcoin's path toward $150,000

Fed Chair Jerome Powell avoided discussing monetary policy during his Oct. 9 Community Bank Conference remarks, supporting Bitcoin’s continued advance toward $150,000.

Matt Mena, Crypto Research Strategist at 21Shares, stated in a note that this was a “strategic omission” by Powell.

He characterized the narrow focus as “effectively a green light for risk assets” because the US data blackout mutes the macro shocks that typically pressure Bitcoin and nudges policy expectations dovish.

With the federal shutdown halting major releases, such as jobs and CPI, traders and the Fed have less hard information to justify new hikes.

Additionally, Bitcoin captured over $2.5 billion in inflows from Oct. 6 through Oct. 8, including Monday’s $1.2 billion single-day haul that ranks as the second-largest on record and drove prices to $126,000.

Flows moderated to $440.7 million on Oct. 8 as the dollar strengthened due to rising Japanese government bond yields, likely prompting tactical de-risking.

Markets now price a 95% probability of a 25 basis point (bps) rate cut at the upcoming FOMC meeting, according to CME FedWatch Tool data. December cut odds stand at 81.5% on CME.

On Polymarket, the odds of a 25 bps rate cut in December are at 71%. Meanwhile, expectations that the US government shutdown would remain in place until at least Oct. 15 reached an all-time high of 88%.

Combined, the odds reflect expectations that extended data delays from the shutdown will prompt the Fed to consider additional easing.

Mena stated:

“The market is clearly digesting gains before its next leg higher, and structurally, it’s hard to see a top forming with liquidity building underneath. Once BTC breaks above $130,000, I expect it to move quickly toward $150,000 – almost like a magnet.”

He added that the consolidation near all-time highs occurs as both the Nasdaq and gold print fresh records almost daily, strengthening the two pillars Bitcoin straddles.

While gold serves as a hedge against currency debasement, strengthening Bitcoin’s narrative as an asset for the “debasement trade,” Nasdaq represents tech proxies for innovation and growth.

Mena projects Bitcoin could reach $150,000 by year-end, representing a 22% gain from current levels.

He concluded:

“Powell may have stayed silent, but liquidity expectations are apparent, and the rest of the market seems to be catching the bid.”