- Bitcoin hovers around $116K with strong volumes and a $2.31 trillion market cap.
- Bulls target the $117K resistance as optimism builds on possible Fed rate cuts.
- The FOMC meeting plays a crucial role in not just crypto but the overall market.
Bitcoin stands at the edge of a pivotal breakout, marking the battlefield between bullish momentum and looming resistance. As of press time, the king of crypto is hovering around $116K, testing investor conviction as U.S. rate-cut expectations fuel optimism for fresh inflows into digital assets.
With traders expecting a looser policy from the Fed in late 2025, momentum has shifted in a positive direction. A rate adjustment could ignite further inflows into digital assets as confidence builds, with traditional investments losing relative appeal.
Technical Levels and Market Activity
The Bitcoin price reflects a 1.01% daily gain as liquidity strengthens. Further, with institutional support, the market cap has pushed to $2.31, with a diluted valuation of $2.45 trillion. Over the past 24 hours, trading activity boosted from 7.43% to $49.05 billion, showing the willingness of buyers to take positions at key levels.
Supply stands as pressure. Out of the 21 million maximum supply, 19.92 million BTC are already in circulation, thus limiting the scope for accumulation. This element of rarity, coupled with rising demand, solidifies Bitcoin’s narrative as a store of value. Price moves have been wild intraday as the coin bounced back from lows of $115,680 to briefly test $117,000 before consolidating near highs.
The volume-to-market cap ratio stands at 2.1%, confirming strong conviction among traders. Bitcoin has maintained upward momentum around the $115,500–$116,000 range, supported by anticipation of a U.S. rate cut. Traders are also watching a CME futures gap and the $117,500 resistance, while support remains anchored near $115,000.
Fed Policy and Market Reactions
The upcoming FOMC meeting will play a central role. Several attempts to clear $116,000 have met rejection or only short-lived gains, making policy guidance crucial. If the Fed confirms a rate cut path, it could decide whether Bitcoin clears resistance or retreats.
Market views remain divided. In his X post, Fundstrat co-founder Tom Lee stated that the rate cut from the Fed could be a catalyst for Bitcoin and Ether, propelling them to surge in the upcoming months. However, risks remain. According to crypto analyst Ted, Bitcoin could drop to $104,000 before reversing or even fall to $92,000 before reaching a new all-time high.
Rate cuts typically benefit risk-on assets because bonds and deposits become less attractive. Yet traders warn that prices sometimes drop after the event if the market has already priced in optimism. The Crypto Fear & Greed Index registered a “Neutral” score of 51 on Wednesday, reflecting hesitation.
Related: Eric Trump-Backed American Bitcoin Joins Nasdaq Exchange
Regulatory Shifts and Global Implications
While traders watch the Fed, regulatory coordination is also developing. The U.S. and the UK are preparing for closer cooperation on cryptocurrency rules. According to the Financial Times, UK Chancellor Rachel Reeves and U.S. Treasury Secretary Scott Bessent discussed a joint framework during meetings in London.
Details are pending, but crypto industry groups urged the UK government to include stablecoins and tokenization in the U.S.-UK Tech Bridge, which already covers AI, cybersecurity, and quantum computing. Leaving out digital finance could disadvantage Britain in global competitiveness.
Markets feel the political winds shifting towards the integration of digital assets into mainstream finance. The U.S. remains unclear about its regulations, whereas the U.K. positions itself to seek innovation. Perhaps with their cooperation, they can get consistent international rules established. Could there be an eventuality where Bitcoin breaks through $116,000 in unison with some conviction just before the FOMC signals its next policy move?
