- Bitcoin trades near $89,842 and Ethereum has reclaimed about $3,026 as investors await a Federal Reserve decision Wednesday.
- Futures markets imply a 97% chance the Fed will hold rates at the 3.5%–3.75% range at its meeting.
- Prediction-market traders on Myriad assign a roughly 33% chance of a rate cut larger than 25 basis points before July.
- The unemployment rate was reported at 4.4% for December, shifting attention to labor-market comments from Jerome Powell.
- Analysts warn Powell’s tone on jobs could move markets by changing expectations for future rate cuts.
Bitcoin traded around $89,842 and Ethereum near $3,026 on Tuesday as investors prepared for the Federal Reserve’s decision Wednesday on interest rates and policy guidance. Markets have priced in a high probability the Fed will leave its target at 3.5%–3.75% at the meeting, and traders are focusing on whether comments about jobs will change the outlook.
Data from CoinGecko showed the recent price moves, and the CME FedWatch Tool implied a roughly 97% chance of no rate change ahead of the announcement. Traders on the prediction market Myriad placed just a 33% chance on a cut of more than 25 basis points before July.
Jummy Xue, co-founder and COO of institutional crypto manager Axis, warned of possible market swings and highlighted the focus on jobs, saying, “While a ‘hold’ at 3.5%–3.75% is a statistical certainty, crypto traders should be wary of a ‘narrative whipsaw,’” and “If [Federal Reserve Chairman Jerome Powell] emphasizes labor market resilience over cooling inflation, he is effectively taking a March rate cut off the table.”
The Bureau of Labor Statistics reported a December unemployment rate of 4.4%, little changed from November. Aurelie Barthere of onchain analytics firm Nansen said she expects the Fed’s concern about jobs to persist and noted, “Even with the U.S. economy accelerating into first half of 2026, boosted by fiscal, the labor market has kept cooling,” and “If Powell’s tone remains as dovish as in December, the pricing of rate cuts could be increased and brought forward before June (March and April).”
Outside the Fed meeting, analysts at QCP Capital flagged other near-term risks, including a Jan. 30 funding deadline to avert a government shutdown and uncertainty over legislation affecting crypto, which could add volatility to markets.
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