The Federal Reserve (Fed) will announce the latest interest rate decision at 2 a.m. Beijing time this Thursday (the 19th). With investors' expectations of a 0.25% or 0.50% rate cut by the Fed heating up, the U.S. stock market surged on September 13th, with the S&P 500 and the Nasdaq index closing higher for five consecutive days, reversing the previous week's weak performance and achieving the largest weekly gain so far this year.

This week, major central banks including those of the United States, the United Kingdom, and Japan will hold policy meetings, with the Fed's decision receiving the most market attention. Fed officials are considering a 0.25% or 0.50% rate cut, but the situation is currently evenly split. The market is also focused on the Fed's latest economic growth forecasts and dot plot, which will provide important guidance for future monetary policy.

There is a belief in the market that Bitcoin is a leading indicator of the overall economy, and a rate cut is generally a significant positive for risk assets such as Bitcoin, potentially bringing significant liquidity to the market. Therefore, Bitcoin's strong performance before a rate cut may be a bullish signal, but is it really so?

After the Fed announces the rate cut decision at 2 a.m. on Thursday, a 0.25% or 0.50% rate cut would still be within market expectations. However, a 0.75% rate cut may indicate a greater risk of recession in the U.S. economy than imagined, potentially leading to more intense fluctuations in Bitcoin prices. Investors should be mindful of risk management.

In addition to the Fed's announcement of the latest interest rate decision at 2 a.m., Fed Chairman Powell will hold a press conference at 2:30 p.m. to share his views on future policies. If his stance is too hawkish, it may impact market sentiment.

In the cryptocurrency market, after hitting a low of $57,431 at midnight yesterday, Bitcoin continued to rebound and quickly surged after 10 p.m., reaching as high as $61,343 at one point, the highest price since September. However, selling pressure emerged afterwards, and the price began to fluctuate and decline in the early hours of today, trading at $59,915 at the time of writing, with a 24-hour gain narrowing to 4.36%.

As the Fed will announce the latest interest rate decision later, I will provide specific market analysis and recommendations based on a 0.25% and 0.50% rate cut for your reference.

Currently, the market generally believes that the probability of a 0.50% rate cut is greater than that of a 0.25% rate cut, which is significant positive news for Bitcoin. However, I believe that if the rate cut is 0.25% this time, it would be below expectations and the positive impact has already been priced in, leading to a rise and then a fall in Bitcoin prices, or even a direct waterfall decline. If a 0.50% rate cut meets market expectations, it indirectly indicates a severe recession in the U.S. economy, causing a sharp decline in U.S. stocks. Although there may be a shift to safe-haven assets, it is not a long-term solution, so Bitcoin prices may initially surge, then decline after the emotional impact of the 0.50% rate cut is absorbed. (I personally favor a 0.25% rate cut)

Instead of giving you a 100% accurate recommendation, I'd rather provide you with the correct mindset and trend, as teaching someone to fish is better than giving them a fish. It's important to focus on the mindset, grasp the trend, and plan your positions in the market. What I can do is to use my practical experience to help guide your investment decisions and management in the right direction.

Drafting time: (2024-09-18, 19:40)

By "Da Xian Shuo Bi"

Special Note: Online publications have a delay, and the above recommendations are for reference only. The author is dedicated to research and analysis in the investment fields of Bitcoin, Ethereum, altcoins, foreign exchange, stocks, and has been involved in the financial markets for many years, possessing rich experience in actual trading. Investment involves risks, so caution is advised when entering the market. For more real-time market analysis, please follow Da Xian Shuo Bi for discussions and exchanges.

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