Amid the ongoing US government shutdown, which has resulted in a lack of key economic data, the Federal Reserve has been a key source of market outlook. On Tuesday, Fed Chairman Jerome Powell noted at the annual meeting of the National Association for Business Economics in Philadelphia that quantitative easing (QE) will begin in the coming months.
“We may be nearing the end of our balance sheet shrinkage in the coming months,” Powell said.
According to Powell, the market outlook has not changed much since the Fed’s September meeting, which is a sign of further rate cuts. However, Powell warned that persistent tariffs have pushed up prices amid a struggling labor market.
Bitcoin Price Rebounds Amid Market Uncertainty
After a historic deleveraging last week that wiped out around $20 billion, the price of Bitcoin (BTC) has sent the broader crypto market into a mild rebound. According to aggregate market data from TradingView, Bitcoin price rose as much as 3% following Fed Chairman Powell’s announcement of the end of the QT era.
The flagship coin has found a robust support level around $110,000 after retesting it three times within a four-hour span, coupled with a bullish divergence of the Relative Strength Index (RSI).
Top reasons why bulls will gain control
The macro outlook for Bitcoin remains bullish despite the medium-term market turmoil. According to on-chain data analysis of CryptoQuantBitcoin whales have aggressively piled up to record highs in the recent past.
Capital rotation from gold to Bitcoin is expected to escalate as the former hovers at overbought levels in the higher time frames. The Fed’s upcoming quantitative easing and interest rate cuts will further strengthen Bitcoin’s macro-bullish outlook.
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