Fed Chairman Jerome Powell avoided discussing monetary policy at his October 9 community bank conference. Remarkssupporting Bitcoin’s continued advance towards $150,000.
Matt Mena, crypto research strategist at 21Shares, said in a note that this was a “strategic omission” by Powell.
He called this narrow focus “effectively a green light for risk assets” as the U.S. data outage softens the macroeconomic shocks that typically pressure Bitcoin and pushes policy expectations to be dovish.
With the federal government shutdown halting key releases, such as employment and CPI, traders and the Fed have less concrete information to justify further hikes.
Additionally, Bitcoin captured more than 2.5 billion dollars in entries Oct. 6-8, including Monday’s single-day haul of $1.2 billion, which ranked second on record and sent prices soaring to $126,000.
Flows moderated to $440.7 million on Oct. 8 as the dollar strengthened on rising Japanese government bond yields, likely prompting a reduction in tactical risks.
Markets are now pricing in a 95% chance of a 25 basis point (bps) rate cut at the next FOMC meeting, according to data from the CME FedWatch Tool. December discount ratings stand at 81.5% on CME.
On Polymarket, the probability of a rate cut of 25 basis points in December are at 71%. At the same time, expectations that the U.S. government shutdown would remain in place until at least October 15 have reached an all-time high. an all-time high of 88%.
Together, the odds reflect expectations that prolonged data delays following the shutdown will prompt the Fed to consider additional easing.
Mena said:
“The market is clearly digesting gains ahead of its next move higher, and structurally it’s hard to see a top forming with liquidity building up below. Once BTC surpasses $130,000, I expect it to move quickly towards $150,000 – almost like a magnet.”
He added that the consolidation near all-time highs is happening as Nasdaq and gold print new records almost daily, strengthening the two pillars straddling Bitcoin.
While gold serves as a hedge against currency depreciation, reinforcing the narrative of Bitcoin as an asset for “depreciation trading,” Nasdaq represents technological proxies for innovation and growth.
Mena predicts that Bitcoin could reach $150,000 by the end of the year, representing a 22% gain from current levels.
He concluded:
“Powell may have remained silent, but liquidity expectations are evident and the rest of the market appears to be following the supply.”
