Bitcoin and mainstream altcoins fell ahead of the Fed meeting, and the market focused on interest rate cut expectations

Bitcoin retreated to near $92,500 in early Asian trading on Wednesday after breaking above $94,000, as the market continued to remain cautious ahead of the Federal Reserve’s key meeting. As investors focus on the latest policy statement and the tone of Jerome Powell’s year-end press conference, the overall cryptocurrency sentiment cools in the short term.

Mainstream altcoins are showing a differentiated trend. Ethereum is up 7% in the last 24 hours and is currently trading around $3,320; Solana and Dogecoin are both up about 5%; Cardano was the strongest performer, with an 8.5% increase on the day. Despite this, these tokens generally retreated 1%-2% in early Asian trading, hinting at profit-taking after an overnight rally. XRP is up slightly by 2% but is still down 4% this week, with BNB, USDC, and TRX largely flat. The market depth for small-cap tokens remains weak, reflecting the ongoing liquidity imbalance since December.

Bitcoin’s short-term rally was partly driven by social media buzz. Santiment noted that the recent rally has triggered a “fear of missing out” (FOMO) among retail investors, with traders anticipating further price gains. However, Bitcoin fell below $93,000 in late Asian session, sparking discussions about whether the downside is technically significant. Some analysts believe that this may just be another stop-loss sweep in the $86,000 to $94,000 range.

CF Benchmarks’ Mark Pilipczuk noted that Bitcoin’s real volatility has exceeded implied volatility for the first time in months, and this crossover has corresponded to a market bottom signal in six of the last eight times. Industry insider Gracy Chen said that the range consolidation of $86,000 to $94,000 shows a lack of clear direction in the market, and crypto assets are more vulnerable to volatility than stocks.

On the macro front, Asian stocks were mixed, with Chinese data showing that the rebound in inflation weakened expectations of further easing, Japan fell slightly, and South Korea and Taiwan rose slightly. The dollar stabilized and silver hit a record high, indicating that global markets are still evaluating whether central banks will continue to ease policy until 2026.

Overall, the key to Bitcoin’s next step is not a short-term breakout, but a market reaction after the Fed meeting. If Powell’s speech reinforces expectations of interest rate cuts, Bitcoin could return to the $94,000 to $96,000 range; If the macro sentiment turns cautious, the price may fall back to the mid-$80,000 area.