The upcoming Fed rate cut could help in a Q4 rally for Bitcoin, Ethereum, and altcoins.
In latest crypto news, the US CPI inflation data is among the most closely watched aspects by traders owing to its impact on the market.
However, digital assets have failed to make much progress, especially as the investors were expecting, after the US CPI inflation data.
According to market experts, the muted trading activity could be due to the fact that the market has already priced the US CPI data.
Although the inflation has cooled in September, it has failed to create much hype among market watchers.
Having said that, the market awaits another major catalyst to influence the market sentiment.
According to experts, the potential Fed rate cut next week could provide a major boost to Bitcoin, Ethereum, and the other altcoins.
Here we explore what experts are anticipating for the future movements of the crypto market.
The crypto market has recorded a slight recovery of over 1% today, and its market cap reached $3.76 trillion.
Bitcoin recorded a surge of around 0.8% to $112k, while Ethereum price rose around 0.22% and stayed above the $3,900 mark.
However, some market watchers were anticipating a robust rally in the broader crypto market.
The US CPI was one of the major crypto market news stories this week, especially amid the ongoing US Government shutdown, which has left investors seeking more insights into the economic health.
According to the latest data, the US CPI comes in at 3% for September, down from the Wall Street expectations of 3.1%.
The Core CPI also comes in cooler than the market expectations, which has initially helped in the financial market recovery.
But the latest momentum indicates that the investors are still treading cautiously, looking for another major catalyst to move sentiment.
Although the cooling US CPI inflation data has failed to trigger a massive run in the crypto market, it has cemented bets over a potential Fed rate cut.
Notably, the US Federal Reserve is scheduled to meet next week, where they are expected to announce a 25 bps policy rate cut.
According to CME FedWatch Tool data, the odds of a potential Fed rate cut are over 98% now.
Having said that, this could act as a major catalyst to move the crypto market towards the north side.
The lower rate cuts usually tend to aid in a strong rally for the risk-bet assets like Bitcoin, Ethereum, and others.
Commenting on the matter, analyst Michael van de Poppe said that the delay in the rally, despite the cooling US CPI data, could be due to BTC price facing major resistance at $112k.
However, he noted that the market may witness a robust recovery in the coming weeks, given the Fed rate cut optimism.
Having said that, the next week could be crucial for the broader financial markets, let alone the crypto market.
Amid the soaring uncertainties, analysts have weighed in, sharing key insights on the potential future movements of the crypto market.
As Bitcoin price struggles to break through the $112k, Ethereum also hovers below the $4,000 mark.
However, it appears that the market pundits have remained bullish on the year-end rally for the assets.
Historically, digital assets tend to offer positive returns through the fourth quarter of the year. Although historical performance doesn’t guarantee future returns, it has so far lifted the sentiment.
It’s worth noting that this October has also started with the “Uptober” sentiment, with BTC price touching an all-time high.
However, the market started to crash on October 10, after Donald Trump escalated trade tensions with China.
This has impacted the global financial market sentiment, with only the gold price seeming to have benefitted from it, going by the growth it displayed recently.
Meanwhile, commenting on the future potential of the crypto market, Tom Lee has hinted at a year-end rally.
In addition, the Fed Reserve is also expected to announce another 25 bps rate cut in December, which further cements the anticipations.
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