6 min read
Bitcoin is bleeding today, and aggregated sentiment on prediction markets is sliding right along with it.
Bitcoin today fell as low as $110,000, tumbling 3% following statements from Federal Reserve Chair Jerome Powell that a December rate cut was “not a foregone conclusion.” Powell’s comments came after the Fed delivered the news of a 0.25% rate cut on Wednesday afternoon, bringing the federal funds target range to 3.75%-4.00%.
But instead of rallying on the dovish move, Bitcoin, Ethereum, and other crypto assets plunged on the more hawkish-than-expected comments.
Meanwhile, Bitcoin sentiment on the prediction market Myriad, a platform developed by Decrypt's parent company Dastan, likewise fell sharply today, dropping by close to 20%. The odds predicting Bitcoin’s next move, upward to $120K or downward to $100K, dropped from 75% predicting a pump to just 58%—a reversal that suggests traders may be losing some of their optimism for BTC’s short-term future.
The Fed’s rate cut today was widely anticipated and should not have had any short-term impact on prices, analysts previously told Decrypt. The sell-off, then, was more likely driven by the more typical “sell the news” action, or Powell’s more hawkish statements, or a combination of the two.
Now, with the Fed decision in the rearview mirror, attention turns to whether Bitcoin can hold critical support levels or if the market is headed for a test of $100K.
But here's the paradox: Institutional money is still flowing in. Bitcoin ETFs saw $202.48 million in net inflows on October 28, pushing cumulative total net inflow to $62.3 billion. That's real conviction—even as short-term traders bail and prediction markets turn, if not bearish, then at least a lot less bullish.
The post-Fed selloff shows that Bitcoin is in trouble in the short term. The cryptocurrency opened today's daily candle at $112,925 and immediately sold off, reaching a low of $109,265 before the Fed announcement. The subsequent drop to $111,700 shows sellers remain in firm control.
Bitcoin price data. Image: Tradingview
The Relative Strength Index, or RSI, for Bitcoin sits at 44.87 on the daily chart. RSI measures whether an asset is overbought (above 70) or oversold (below 30) on scale from 0 to 100. This reading indicates Bitcoin is in a neutral zone hinting at a slight bearish tilt. But holders are not panicking, and this isn’t evidence of a bearish trend by any means.
The situation, though, looks even weaker on shorter timeframes. The four-hour chart shows RSI at just 36.38, flirting with oversold territory. This tells traders that selling pressure is building. Traders, then, would monitor upcoming candlesticks, checking for a potential bounce back to the upwards channel that was in play since mid-October.
Bitcoin price data. Image: Tradingview
On the daily charts, the Average Directional Index, or ADX, reads just 17.29. ADX measures trend strength regardless of direction, likewise on a scale from 0 to 100, with readings above 25 confirming a trend is in place. Even on the four-hour timeframe, Bitcoin’s ADX only reaches 24.22, showing that market indecision is growing. Traders might interpret this as movement but with no conviction behind it.
The Exponential Moving Averages, or EMAs, tell a split story. EMAs give traders a sense of price supports and resistances by taking the average price of an asset over the short, medium, and long term.
On the daily chart, the 50-day EMA, meaning the average price of Bitcoin over the last 50 days, still trades above the 200-day EMA. This typically signals the longer-term uptrend remains intact. This is the one bullish technical element keeping hope alive. However, on the four-hour chart, the 50-period EMA has crossed below the 200-period EMA—a bearish "death cross" that suggests short-term momentum has shifted to the downside.
But the fact that EMAs are hinting at a potential golden cross in the four-hour candlesticks is enough to give traders some hope that Bitcoin could still end the month back in its bullish channel.
Here's the thing about markets: They rarely care about what happens, and are mostly driven by what happens relative to expectations.
The Fed’s 0.25% rate cut was priced in with 97% certainty, according to the CME FedWatch Tool, which uses futures trading data to determine sentiment. When something is that widely expected, there's no fuel for a rally—everyone who wanted to buy had already bought.
Historically, lower rates have fueled bullish momentum in crypto by making borrowing cheaper and pushing investors toward riskier assets. But that effect takes time to work through the system. In the immediate aftermath, we're seeing the flip side: profit-taking by traders who positioned themselves ahead of the announcement, and potentially lower conviction traders shaken by Powell’s unexpected comments.
What could have sparked a rally? A surprise 0.50% cut (which Federal Reserve Governor Stephen Miran voted for but was outvoted) or extremely dovish forward guidance from Powell signaling aggressive continued easing. Neither materialized.
The selloff has bigger implications beyond just the Fed reaction. Just yesterday, technical analysis suggested Bitcoin would likely close October above the $114,200 monthly open level, keeping the "Uptober" seasonal trend alive.
Bitcoin was trading at $115,542 with bullish momentum indicators (ADX at 32, RSI at 69, bullish squeeze firing), and prediction markets showed 70% odds favoring continued upside. That narrative just got a heavy blow. With Bitcoin now at $111,700—a full 2.2% below the monthly open—October is set to close red unless we see a dramatic reversal in the next 48 hours. So much for Uptober.
With the Fed decision behind us, the focus shifts back to pure price action. Bitcoin now sits at a critical juncture, and the next few days will likely determine whether we're headed to $100K or can reclaim the path to $120K.
The bearish case is straightforward: Technical indicators are weak, prediction markets have moved dramatically, momentum is gone, and the "sell the news" playbook is on. The $110,000-$111,000 zone is providing temporary support, but if that breaks, the path of least resistance is down to $106,000-$108,000 where the 200-day EMA provides stronger support.
The bullish case requires Bitcoin to reclaim $112,500 and hold it as support. From there, a push through $114,000 with increasing volume could invalidate the bearish setup and open the door to $117,000-$120,000.
For the traders out there, it’s relatively straightforward: Until Bitcoin can reclaim $112,500 and show some actual momentum (ADX above 25 would be a start), the path of least resistance is now down.
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