• Bitcoin’s price action respects a descending trendline from its October peak, trading below key EMAs in death cross territory.

• Ethereum failed to form a golden cross, remaining below the 200-day EMA with neutral RSI signaling ongoing uncertainty.

• Nearly 90% of the crypto market is in the red, per CoinMarketCap data, with top assets facing double-digit losses amid reassessed liquidity expectations.

Bitcoin and Ethereum downtrend persists after Fed’s rate cut to 3.5%-3.75%. Explore technical indicators showing bearish momentum and market reactions. Stay informed on crypto trends for smarter investment decisions.

What is causing the Bitcoin and Ethereum downtrend after the Fed rate cut?

Bitcoin and Ethereum downtrend has emerged despite the Federal Reserve’s anticipated 25-basis-point interest rate reduction to the 3.5%-3.75% range, as digital assets diverge from traditional markets. While the S&P 500 rose 0.67% and the Nasdaq increased 0.42%, the crypto sector lost 2.25% in value, reaching a total market cap of $3.07 trillion. This separation highlights traders’ concerns over future liquidity, even with reduced borrowing costs, leading to widespread selling pressure across 90% of the market according to CoinMarketCap metrics.

How are technical indicators reflecting bearish control in Bitcoin’s price?

Bitcoin’s current price of $89,977 reflects a 2.24% decline over the past 24 hours, after peaking at $92,103 before sellers dominated. The asset adheres to a descending trendline established since its October high near $126,000, struggling to maintain the $90,000 psychological support level. Trading below both the 50-day and 200-day exponential moving averages (EMAs) confirms a death cross pattern, a bearish signal where the shorter-term average crosses under the longer-term one, indicating sustained downward momentum. The Relative Strength Index (RSI) at 44.23 underscores selling pressure, as values below 50 suggest more bears than bulls, though not yet deeply oversold below 30. Additionally, the Average Directional Index (ADX) at 28.15 measures trend strength above 25, validating that this downtrend is robust and sellers maintain control. Data from TradingView illustrates these patterns clearly, with volume concentrated at higher price levels, implying many holders are facing unrealized losses.

Prediction markets offer a contrasting view on sentiment. On platforms like Myriad, operated by Dastan’s entity, 69% of bets favor Bitcoin reaching $100,000 over dropping to $69,000, while 90% odds reject an impending “crypto winter.” This resilience in long-term conviction persists amid short-term volatility, as noted in market analyses from sources such as COINOTAG.

Ethereum faces steeper challenges, declining 4.40% to $3,178.8 from an opening of $3,324.3, hitting a low of $3,146.4. The cryptocurrency briefly breached its immediate resistance and the 50-day EMA but failed to surpass the 200-day EMA, preventing a golden cross formation—the bullish counterpart to Bitcoin’s death cross. For a golden cross to solidify, sustained closes above the 200-day EMA are required, which did not occur, preserving the bearish structure. Ethereum’s RSI at 51.24 hovers in neutral territory, offering no clear edge to bulls or bears; readings above 70 signal overbought conditions, while below 30 indicate oversold opportunities. Technical setups, including a red and expanding Ichimoku cloud and a descending channel, align with short positions, showing a -41% bearish score. Volume profiles reveal most activity at elevated prices, suggesting underwater positions for many investors. TradingView charts depict this stalled recovery, emphasizing the fight for bullish momentum.

Sentiment in prediction markets for Ethereum has shifted toward balance, with Myriad traders now at 50-50 odds for a rise to $4,000 versus a fall to $2,500—a notable change from November’s 90% bearish lean. This cautious optimism underscores the market’s volatility but highlights underlying strength in Ethereum’s ecosystem.

The Federal Reserve’s decision, while expected, did not translate to crypto enthusiasm as it did for equities. Lower rates typically ease borrowing and boost risk assets, yet crypto’s reaction points to deeper worries about liquidity and economic signals. CoinMarketCap reports that top-10 cryptocurrencies by market cap endured significant losses, some exceeding double digits, amplifying the sector-wide bleed. Experts from financial outlets like Bloomberg and Reuters have observed similar disconnects in past rate cycles, where crypto’s sensitivity to global liquidity outpaces stock market responses.

Broader market dynamics play a role too. Institutional inflows, tracked by firms such as Glassnode, have slowed, with on-chain data showing reduced accumulation at current levels. Regulatory clarity remains elusive, adding to caution among traders. According to Chainalysis reports, global adoption continues, but short-term price action is dominated by macroeconomic cues like the Fed’s forward guidance on inflation and employment.

Historical context reinforces this pattern. Post-rate cut environments in 2023 saw initial crypto dips before recoveries, driven by ETF approvals and halving events. However, current technicals suggest no immediate reversal, with Bitcoin’s failure to reclaim $100,000 as a key barrier. Ethereum’s performance ties closely to network upgrades, like the recent Dencun enhancement, which improved scalability but has not yet spurred price gains amid bearish pressures.

Traders monitoring these assets should note support levels: Bitcoin at $85,000 and Ethereum at $3,000 could test further if selling intensifies. Conversely, breaks above $92,000 for BTC or $3,300 for ETH might signal short-term relief. Data from Kaiko analytics indicates exchange outflows picking up, potentially stabilizing prices if hodlers prevail.

Frequently Asked Questions

Why is the crypto market declining despite the Fed’s rate cut?

The crypto market’s decline post-Fed rate cut stems from traders reassessing liquidity amid ongoing economic uncertainties, despite lower borrowing costs benefiting traditional assets. Bitcoin and Ethereum specifically show technical bearishness, with 90% of the sector in red per CoinMarketCap, as the anticipated relief rally fizzled, prioritizing long-term Fed signals over immediate cuts.

What do prediction markets say about Bitcoin’s future direction?

Prediction markets on platforms like Myriad indicate strong long-term bullishness for Bitcoin, with 69% of bets favoring a move to $100,000 over $69,000, and 90% odds against a crypto winter. This contrasts short-term price drops, reflecting traders’ confidence in eventual recovery driven by adoption and halvings.

Key Takeaways

• Bearish Technicals Dominate: Bitcoin’s death cross and Ethereum’s failed golden cross confirm seller control, with RSI and ADX underscoring momentum against bulls.
• Market Disconnect Evident: While stocks rallied, crypto’s 2.25% drop highlights unique liquidity sensitivities, affecting 90% of assets per CoinMarketCap.
• Sentiment Remains Resilient: Prediction markets show 69% bullish bets on Bitcoin and balanced odds for Ethereum, advising focus on support levels for potential entries.

Conclusion

The Bitcoin and Ethereum downtrend after the Fed’s rate cut illustrates crypto’s volatile response to monetary policy, with technical indicators like EMAs and RSI pointing to sustained bearish pressure. As the market cap settles at $3.07 trillion, authoritative insights from CoinMarketCap and TradingView emphasize caution. Investors should monitor upcoming economic data for reversal cues, positioning strategically for crypto’s inherent recovery potential in a maturing landscape.