Markets Expect October Fed Rate Cut as Bitcoin Slightly Pulls Back, Repeating Post-FOMC Pattern

At the time of writing, Bitcoin is trading around $111,359, marking a slight decline from previous levels. Meanwhile, markets are eagerly awaiting the October Federal Reserve meeting, where the central bank is widely expected to cut interest rates by 25 basis points. This move would bring the target range for the federal funds rate down to 3.75–4.00%, continuing the monetary easing cycle that began earlier this year. While some traders anticipate a post-Fed rally, others warn that Bitcoin may once again follow its familiar pattern — a short-term drop right after the announcement, followed by a strong recovery.

Markets Have Already Priced in the Cut According to data from CME Group and Kalshi, markets are almost unanimously expecting a rate reduction —

the probability of a 25-basis-point cut stands between 97.8% and 99%.

Open interest in Fed futures contracts remains high, confirming that most investors have already priced in the move. These expectations have recently helped push Bitcoin above $113,000, before a modest correction brought it back to current levels.

Prediction markets on Kalshi have recorded over $34 million in volume related to this event, underscoring how confident traders are that the Fed is nearing the end of its tightening cycle.

All Eyes on Jerome Powell Crypto analyst Daan Crypto Trades noted that the rate cut itself is unlikely to surprise markets, as it’s already fully priced in.

The real market mover, he said, will be Fed Chair Jerome Powell’s post-meeting remarks. Traders will closely watch whether Powell signals an end to quantitative tightening (QT) and hints at a possible return to quantitative easing (QE) — potentially as early as 2026. Daan also pointed out that markets are already assigning a 95%+ probability to another rate cut in December 2025, meaning Powell’s tone on liquidity and balance sheet management could significantly impact the U.S. dollar and crypto markets alike.

Bitcoin and the Familiar “FOMC Pattern” Analyst Ted Pillows highlighted a recurring trend in Bitcoin’s behavior around Fed meetings —

after each of the last three FOMC decisions, Bitcoin dropped between 6% and 8%, only to set a new all-time high (ATH) before the next meeting. “$BTC dropped 6–8% after the last 3 FOMC meetings,

and made a new ATH before the next one.

Will this pattern repeat again?” wrote Pillows on X. If history repeats itself, Bitcoin could once again rebound after a short-term dip — potentially targeting the $120,000 zone in the weeks ahead.

Short-Term Volatility, Long-Term Strength Historically, Fed rate cuts often trigger short-term sell-offs in Bitcoin as traders react to uncertainty and reposition their capital.

But once the dust settles, greater liquidity and cheaper borrowing costs usually support a renewed uptrend. If the pattern holds, the coming weeks could bring:

🔹 A temporary drop in BTC following the Fed decision

🔹 A swift recovery and renewed rally into November

Summary At the time of writing, Bitcoin trades at $111,359, down slightly amid investor caution before the Fed meeting.

Markets expect a 25-basis-point rate cut, with Powell’s comments likely to determine short-term market direction.

Historically, post-FOMC dips have been followed by strong recoveries — and traders now wonder whether the same playbook will unfold again. All eyes are on Washington, as Bitcoin waits to see whether history will repeat itself after the October Fed meeting.

#bitcoin , #fomc , #Fed , #Powell , #CryptoNews

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