Bitcoin traders are facing a tricky time ahead, with the much-anticipated U.S. Federal Reserve rate cut potentially dragging the cryptocurrency’s price down by as much as 20%, contrary to popular market expectations.
While many hoped the rate cut would boost Bitcoin, analysts are signaling caution.
Bitfinex’s research team issued a note on Sept. 2, stating, “We would caution to expect a 15-20 percent decline when rates are cut this month, with a bottom of $40,000-$50,000 for BTC.”
This prediction comes as September historically tends to be a volatile month for Bitcoin, with the looming Fed decision adding yet another twist to the tale.
The Federal Reserve is set to decide on interest rates on Sept. 18, following dovish remarks from Chair Jerome Powell in August, hinting that “the time has come” for a cut.
Traditionally, investors view riskier assets like Bitcoin as more attractive when interest rates fall, as safer investments like bonds lose their appeal.
However, traders should remain cautious this time around.
Currently trading at $57,754, Bitcoin is down 2.67% over the past week, according to CoinMarketCap.
Should it dip 20%, Bitcoin would fall to around $46,000—levels unseen since February.
Markus Thielen, head of research at 10x Research, sees this as a crucial price point before Bitcoin’s next bull run.
He explained that prices need to fall into the low $40,000s before considering the next market entry.
The broader business community is also keeping a close watch, as changes in the financial landscape often affect both traditional and emerging markets.
In a Sept. 3 post on X (formerly Twitter), analyst Joe Consorti said $60,000 is no longer a speculative top but a “consolidation zone” where long-term holders accumulate.
Meanwhile, crypto trader Daan Crypto Trades noted that Bitcoin is “still fighting around its Bull Market Support Band” but is yet to make a decisive move in either direction.
As the Fed decision looms, traders and investors are bracing for Bitcoin’s next move, which could surprise even the most seasoned market players.
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