#美联储降息展望 An exciting moment is coming! Will the market soar to the sky, or will it experience a dramatic big dump?

$BTC $ETH $BNB

At 2 AM tonight, the Federal Reserve is about to announce a key decision:
It is expected to lower the interest rate by 25 basis points, bringing the benchmark interest rate down from 4%-4.25% to 3.75%-4%, which means a reduction in the cost of funds.
At the same time, it may announce the termination of the quantitative tightening (QT) policy, stopping the recovery of funds from the market, which effectively increases market liquidity.

Why is this decision so important?
1. Liquidity expansion: Terminating quantitative tightening will increase the available funds in the banking system, lower financing thresholds, and benefit the price rise of risk assets such as US Treasuries, stocks, and cryptocurrencies.
2. Decreased attractiveness of deposits: Lower interest rates lead to reduced returns on bank deposits, which may encourage investors to shift their funds to the stock market and the cryptocurrency market in search of higher returns.
3. Possibility of historical repetition: Looking back at the massive liquidity release by the Federal Reserve in 2020, Bitcoin rose from $10,000 to $60,000. A similar easing policy could trigger a bull market again.

Potential impact on the cryptocurrency market:
In terms of mainstream cryptocurrencies: Improved liquidity may drive Bitcoin to hit the high of $120,000, while Ethereum is expected to challenge the $4,500 mark.
Small-cap coins: Coins with high volatility characteristics, especially artificial intelligence concept coin RNDR and privacy protection coin ZEC, may experience significant gains.
It should be noted that if the Federal Reserve's stance is not accommodative enough, or if subsequent inflation data rebounds, the market may face short-term adjustment risks.

Investment strategy recommendations:
Short-term traders: It is recommended to closely monitor the first hour after the announcement, as this period usually experiences the most volatility, with Bitcoin possibly fluctuating by 3%-5% in a short time.
Long-term holders: If the Federal Reserve confirms the end of quantitative tightening, firmly holding spot positions may be a wise choice, and the second half of the bull market may begin early.
Leverage traders: Sudden and drastic price fluctuations often accompany high market sentiment, so it is essential to manage risks carefully and set reasonable stop-losses.

In summary, the Federal Reserve is likely to release positive signals tonight, and the crypto market is poised to take off. However, it is important to be cautious, as positive news could also become a short-term peak, making rational investment crucial!