Dear cryptocurrency friends, the Federal Reserve is set to announce the September interest rate decision this Thursday morning Beijing time. The market generally expects a probability of over 90% for a 25 basis point rate cut, and there is even a small chance of a 50 basis point cut. However, I anticipate that after the rate cut is implemented, Bitcoin is likely to experience a short-term 'downward spike' market, potentially reaching a magnitude of 5000 points, once again testing the support around 110,000 USD!

Historical patterns warn:

Looking back at July 2019, after the Federal Reserve's rate cut, Bitcoin briefly rose about 19%, but subsequently experienced a nearly 50% correction within the next six months. After the rate cut in 2020, it also went through a brief decline before rebounding. The script of 'buy the expectation, sell the fact' may be replayed again— the market has already priced in the positive effects of the rate cut, and after it is implemented, it may instead see profit-taking.

Technical pressure:

Bitcoin is currently still below the key resistance level of $118,000. If it can break through this level, it may open up upward space. However, around $115,000 is a daily level resistance, and if it can effectively break through, it may further challenge $120,000.

On-chain and institutional dynamics:

Whale sell-off: In the past month, Bitcoin whales have sold BTC worth up to $12.7 billion, marking the largest sell-off since mid-2022. Although the selling speed has slowed, the massive selling pressure still needs time to digest.

Options market signals: The open interest in the options market has declined, indicating lower participation, while the 25-delta skew remains high, suggesting ongoing demand for downside protection, with sentiment slightly bearish.

"Interest rate cuts" may also be a double-edged sword:

If the Federal Reserve only cuts interest rates by 25 basis points and does not give a strong dovish signal, the market may be disappointed.

Even with a 50 basis point cut, after short-term sentiment stimulation, concerns about economic recession may regain dominance, limiting the gains.

📌 Operational suggestions:

Short-term traders: Be wary of increased volatility after interest rate cuts and ensure risk control. If the market quickly dips near $110,000 and shows stabilization signals (such as a double bottom on the hourly chart or RSI divergence), it may be a short-term buying opportunity.

Medium to long-term holders: Any significant pullback may be a good bottom-fishing opportunity. In the long run, the Federal Reserve's initiation of a rate-cutting cycle is beneficial for risk assets, and Bitcoin's long-term trend remains upward.#美联储降息预期升温