Key reasons the market sold off — even after the Fed cut rates:
1) The rate cut was already priced in
Investors were nearly 100% certain of a 25 bps cut, so the actual announcement didn’t create new bullish news — it was already factored into prices.
2) Powell’s press briefing added uncertainty
Fed Chair Powell’s tone was cautious, not strongly dovish. The “dot plot” showed only one more expected cut in 2026, not a broad easing cycle — signaling less aggressive future support than many had hoped.
3) Market was already front-run
Large traders and whales started buying ahead of the Fed — pushing prices up before the announcement. Once the event happened, many took profits → this triggered the first leg of the sell-off. (This happens in markets when expectations overshoot what actually arrives.)
4) The Fed pause/balanced message created risk-off mood
Even though rates were cut, the limited expected future cuts and cautious guidance made investors reprice risk assets lower. Crypto and stocks can react like this when the easing path is seen as less robust than expected.
5) Oracle’s weak earnings hit sentiment
Oracle reported missed revenue and higher capex, dragging its stock sharply lower. That spilled over into tech futures and risk assets — pushing stocks and crypto down together.
➡️ In short:
The market didn’t dump because the Fed was bearish — it dumped because expectations were too bullish going into the event:
• The rate cut was priced in
• Powell didn’t signal a larger future easing cycle
• Front-running profit-taking kicked in
• A major tech earnings miss sparked risk-off flows
So risk assets — including $BTC — dropped not due to fundamentals suddenly worsening, but because event expectations overshot reality.
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📌 WHAT STILL REMAINS BROADERLY SUPPORTIVE?
✅ Fed is cutting rates — easing financial conditions (3rd straight cut).
✅ Powell did not signal future hikes are base case.
✅ The Fed restarted T-bill purchases to support liquidity.
Bottom line: The market paused and retraced because positioning was too aggressive — not because the macro picture suddenly turned bearish. The longer-term liquidity environment remains more supportive than earlier in 2025.$BTC
