Traders Turn Increasingly Bearish on Bitcoin and Ethereum After Fed Meeting

Market Sentiment Shifts

Traders are increasingly pessimistic about Bitcoin and Ethereum as their prices have dropped recently, following a hawkish tone from the Federal Reserve's new Chair, Kevin Warsh, during his inaugural FOMC meeting.

Price Declines

Both cryptocurrencies have seen a decline of about 5% in the last 24 hours, with Bitcoin (BTC) currently priced at $62,499 and Ethereum (ETH) at $1,682. Market expectations have shifted, with traders now predicting an 80% chance of no interest rate cuts this year, as per Polymarket data. The CME FedWatch tool suggests a potential rate increase could occur by the end of the year.

Increased Bearish Predictions

The likelihood of Bitcoin falling to $55,000 has jumped over 10% in just one day, with current predictions indicating a 72% chance of this drop before a possible recovery to $84,000. Meanwhile, Ethereum faces an 83% probability of declining to $1,500 before experiencing a rise to $3,000. This represents a 4% increase in bearish sentiment in the past day and a more than 23% rise over the past month.

Market Reactions

The bearish outlook has spurred increased activity in Myriad’s “Pump or Dump” markets, where users speculate on price movements. Despite the negative sentiment, analysts at Bitfire Research mentioned that Bitcoin is in a "high-value entry window," suggesting potential buying opportunities amidst the downturn.