According to PANews, recent developments in the macroeconomic landscape have highlighted the Federal Reserve's 'policy split' and 'information vacuum,' which are causing short-term market fluctuations and potentially setting the stage for long-term structural benefits. The market consensus anticipates a 25 basis point rate cut by the Federal Reserve in its October meeting, following signals from Chairman Jerome Powell indicating a 'flexible dovish' stance. This expectation has bolstered confidence in liquidity easing, driving capital into the cryptocurrency market and pushing Bitcoin's price to a short-term high of $126,000, reflecting positive market sentiment.
The ongoing easing policies are expected to dilute the purchasing power of fiat currencies, reinforcing Bitcoin's narrative as an inflation-resistant, non-sovereign store of value. Bitcoin's correlation with gold, rather than U.S. stocks, underscores its hedging attributes. The recent pullback of Bitcoin to $121,000 and the volatility in altcoins are seen as the market's natural response to digesting high-risk levels and awaiting macroeconomic data confirmation, rather than a breakdown of previous macroeconomic logic.
The Federal Reserve's current 'policy split' and 'information vacuum' have intensified short-term market consolidation and volatility. Two key factors are at play: Powell's flexible stance and the Fed's inclination towards 'preventive rate cuts' have created a psychological expectation of 'long-term liquidity easing,' providing emotional support for the cryptocurrency market. As long as the Fed does not rule out the possibility of rate cuts, fears of a 'bear market' remain subdued.
The delay in releasing key economic data due to a government shutdown has turned the October Fed meeting into a decision-making process 'flying in the dark.' This uncertainty has led to 'unexpected optimism premiums' during market highs, which have transformed into 'uncertainty risk premiums' as emotions stabilize. The current market decline is a phase of releasing these risk premiums.
The ongoing market consolidation is essentially a natural transition in investor psychology from 'blind optimism' to 'cautious observation,' rather than a trend reversal. It is likely a buildup of momentum for the next upward surge. The market's core focus has shifted to 'delayed key economic data.' If the data, once released, indicates economic weakness in employment and inflation, it will provide 'factual support' for Fed rate cuts. This could lead to a concentrated release of suppressed liquidity, likely maintaining Bitcoin's strong momentum and pushing it to new highs. In summary, the ultimate formation of the cryptocurrency market trend relies on the combined validation of 'macroeconomic data and Federal Reserve actions.'
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