Bitcoin’s price trajectory faces consolidation below the $120,000 mark as the Federal Reserve halts further interest rate cuts, influencing market dynamics and long-term investor behaviour.
The Federal Reserve’s decision to maintain interest rates within the 4.25-4.50% range has tempered expectations for impending monetary easing. This pause directly impacted Bitcoin’s momentum, contributing to the ongoing price consolidation phase above previous highs.
Amidst this uncertainty, long-term Bitcoin holders have engaged in significant distribution, offloading approximately 207,000 BTC over the past month. This movement signals potential proactive risk management strategies as market sentiment cools.
Simultaneously, a critical market metric highlights growing unrealized profits. The Total Unrealized Net Profit/Loss (NUPL) has achieved an unprecedented $1.4 trillion, suggesting substantial potential selling pressure could materialize if market confidence wanes.
Reflecting the more cautious environment, the widely followed Fear & Greed Index has declined, indicating reduced trader risk appetite. This shift points towards a persistent environment of heightened vigilance within crypto markets.
Market recalibration is further evidenced by shifting interest rate projections. Probability models now show the chance of a September Fed rate cut has plummeted from over 90% to 41%, while the likelihood of no cuts for the remainder of the year has risen to 25%.