Sell the News? Bitcoin Market Shrugs Off Fed Moves: Analysis

Fed fatigue or was it simply priced in all along? Bitcoin is down a paltry 1% today, currently trading at around $115,500, following the Federal Reserve’s widely telegraphed quarter-point rate cut.

The crypto market appears a bit gassed, but if anything, today’s relatively small drop in prices could be interpreted as a classic “buy the rumor, sell the news” event.

The Federal Open Market Committee lowered its benchmark overnight lending rate by a quarter percentage point in an 11-to-1 vote, putting the overnight funds rate in a range between 4.00%-4.25%.

Rate cuts are typically bullish for risk assets, and yet markets appeared to have been pricing in this move for weeks and showed little enthusiasm. Bitcoin, for instance, was unable to hold above the psychologically important $117,000 level after briefly touching it today.

The overall crypto market still sits above $4 trillion, though down less than 1% in the last 24 hours, while the average performance of the top 20 cryptocurrencies has slipped 0.43%, according to data from Coinmarketcap. So, no FOMO just yet from the Fed’s easing. The Crypto Fear and Greed Index remains almost perfectly neutral at 51 points, down 6 points from last week’s greedy mood.

Fed Chair Jerome Powell characterized the cut as “risk management” rather than something more directed at shoring up a weak economy, which may explain the market’s lukewarm response. With a 96% chance of a 25 basis point cut already priced in way before the announcement, traders appear to be executing the classic “buy the rumor, sell the news” playbook.

The political drama surrounding the Fed decision added another layer of uncertainty. Newly installed Governor Stephen Miran—a widely recognized pro-Trump economist who advised him during his previous tenure—was the only policymaker voting against the quarter-point move, instead advocating for an even larger half-point cut.

So what can be gleaned from the Bitcoin charts today?

The daily chart for BTC shows a market in limbo, with price action basically trading sideways since June, but with an ever so slightly upwards trajectory.

Bitcoin opened today at $116,836, but dipped to a low of $114,747 immediately after the Fed’s announcement, before bouncing to its current price for a net loss of less than 1% on the day.

The Relative Strength Index, or RSI, for Bitcoin sits at 58 in neutral to bullish territory. RSI measures price momentum on a scale of 0 to 100, where values above 70 indicate overbought conditions and below 30 suggest oversold levels. Bitcoin has gained a bit of momentum since dropping below its average price over the last 50 days of $110,000 back in late August