Why Is Bitcoin Not Going Up After The Fed Cut Rates?

Core Insights - The Federal Reserve's third consecutive 25 basis points rate cut has temporarily boosted retail optimism for Bitcoin and Ethereum, but the market quickly reversed direction [1][3] - Lower interest rates typically enhance liquidity and weaken the dollar, which can benefit risk assets; however, retail enthusiasm peaked before the Fed's announcement, leading to a "buy the rumor, sell the news" scenario [2][5] - Bitcoin has underperformed compared to equities and gold this year, increasing the likelihood of a catch-up rally as liquidity improves [4] Market Dynamics - A significant sell-off occurred when a whale offloaded $100 million in Bitcoin just before Jerome Powell's remarks, causing volatility [3] - Despite the volatility, the macroeconomic environment is becoming more favorable for cryptocurrencies, with three consecutive rate cuts and improving liquidity conditions [6] - Social sentiment indicates a divide, with Bitcoin traders remaining cautious while Ethereum traders aggressively entered the market post-FOMC, only to face immediate pullbacks as larger players sold into strength [5] Future Outlook - Short-term volatility is expected to continue, but the combination of rate cuts, improved liquidity, and rising investor confidence suggests a stronger setup for Bitcoin and the broader crypto market heading into 2026 [6] - Smart-money wallets holding between 10 to 10,000 BTC have accumulated over 42,000 BTC since November 30, indicating positioning for a potentially stronger market in 2026 [4]