Bitcoiners are hoping the price of Bitcoin will only temporarily decline after the chances of a Fed rate cut in December have doubled.

Bitcoiners are starting to feel hopeful after the likelihood of a US Federal Reserve (Fed) interest rate cut at its December meeting nearly doubled in 24 hours, leading many to believe that the downward pressure on Bitcoin may be easing.

November 22, 68 – Bitcoin's price has been falling steadily this week, breaking below $95,000 on Monday, November 17, and hitting a low late Friday, November 21, falling as deep as the $80,000 zone before quickly rebounding. The price is currently trading in the $84,000-$85,000 zone, down around 10% for the week. However, the crypto market is starting to show more positive signals with reports that the Fed may announce an interest rate cut this December.

Bitcoin price in the morning of November 22, 68: Image from TradingView

The website cointelegraph, citing data from the CME FedWatch Tool, reported that the probability of an interest rate cut rose from 29% to 71% following dovish remarks by New York Fed President John Williams, who said the Fed could cut rates in the near term without impacting its inflation target. Bloomberg analysts believe this statement was a key catalyst for the surge, but it remains to be seen whether this factor will be enough to trigger a market bottom.

Meanwhile, analyst Mister Crypto points out that general interest rate cuts are a positive sign for risky assets like Bitcoin because they reduce the yield on assets like bonds, prompting investors to seek higher-yielding assets.

Renowned analyst Jesse Eckel added that , looking at the long term, the market is now unexpectedly starting a bull run, noting that we are shifting from an interest rate hike cycle to a monetary easing cycle, which typically supports the prices of risky assets.

Other analysts, such as Curb, clearly see that if the Fed signals further easing, the crypto market could enter a strong rebound.

However, economist Mohamed El-Erian cautioned investors not to interpret the Fed's remarks too positively, as the overall economic situation still needs to be closely monitored.

Coinbase Institutional points out that the market may be misjudging the possibility of an interest rate cut, as tax data, private data centers, and real-time inflation indicators suggest that interest rates should be lowered to address economic pressures.

The Crypto Fear & Greed Index is in the Extreme Fear zone.

Despite new hopes emerging, the overall sentiment in the crypto market remains subdued. The Crypto Fear & Greed Index reported an Extreme Fear level of 11, reflecting investor confidence in a sustainable recovery.

References: cointelegraph.com , coinmarketcap.com , cmegroup.com

Read news related to Cryptocurrency here