Bitcoin prices fell Wednesday night into Thursday, even after the U.S. central bank cut interest rates as Fed Chairman Jerome Powell signaled a cautious approach heading into 2026.
On Wednesday, the Fed cut its benchmark interest rate by 25 basis points to 3.50%-3.75%, a move widely expected by markets. However, the 9-3 split among members of the Federal Open Market Committee (FOMC) and Powell’s hawkish remarks during the press conference dampened investor enthusiasm for risk assets, including cryptocurrencies.
One official favored a deeper cut of 50 basis points, while two voted against any reduction.
Bitcoin price briefly jumped above $94,000, but then fell below $90,000 and stabilized around $89,730 at the time of writing.
Bitfinex analysts shared Bitcoin Magazine that the Fed’s unexpectedly hawkish tone surprised markets, causing a reversal and keeping risk appetite in check.
The Fed’s updated “dot plot” shows little consensus for more than a single 25 basis point cut in 2026, with stronger growth forecasts and changing fiscal policy limiting easing in the near term.
Timot Lamarre, director of market research at Unchained, wrote to Bitcoin Magazine that “
There is so much to be bullish about in the bitcoin space – from Square facilitating bitcoin payments to major institutions like Vanguard now giving their clients access to bitcoin ETFs for quantitative easing coming to an end.”
Lamarre said bitcoin’s recent price movements show a gap between growing adoption and the price increase that usually comes with higher demand.
Bitcoin price decline and broader market pullback
Bitcoin price’s recent pullback also reflects broader market concerns. Tech stocks, including Oracle, suffered after disappointing earnings and warnings of slower-than-expected AI-related profits.
Oracle shares fell 11% in after-hours trading after revenue and earnings forecasts fell short of analysts’ expectations.
The Fed’s outlook for 2026 suggests just one more rate cut, fewer than markets had expected. Asian shares fell and US stock futures edged lower, while European trade remained muted.
Standard Chartered recently revised its year-end Bitcoin forecast, lowering its target from $200,000 to $100,000, citing a slowdown in corporate treasury purchases and reliance on ETF inflows to support future gains.
Bernstein analysts recently said they are seeing a structural shift in Bitcoin’s market cycle, meaning the traditional four-year pattern has broken. They foresee a protracted bull cycle driven by steady institutional buying, offsetting retail selling and minimal ETF outflows.
The bank raised its 2026 price target to $150,000 and expects the cycle to top near $200,000 in 2027, maintaining a long-term 2033 target of around $1 million per share. BTC.
Meanwhile, JPMorgan remains bullish over the next year, projecting a gold-linked, volatility-adjusted Bitcoin target of $170,000 within six to twelve months, taking into account market fluctuations and mining costs.
Analysts say Bitcoin’s drop after the Fed announcement reflects a “sell the fact” dynamic. “The market had fully priced in the cut in advance,” said Tim Sun, senior researcher at HashKey Group. “Concerns about political and economic developments in 2026, combined with potential inflation from AI-driven capital spending, are weighing on risk sentiment.”
Last week, the Bitcoin price saw a volatile ride, falling to $84,000 before bulls pushed it up to $94,000, before falling just below $88,000 and closing the week at $90,429.
The market now faces key support at $87,200 and $84,000, with deeper support zones around $72,000-$68,000 and $57,700.
Resistance levels lie at $94,000, $101,000, $104,000 and a thick zone between $107,000-$110,000, with momentum likely to wane above $96,000.
Typically, rate cuts lead to bullish momentum, but the market may have already factored in this month’s rate cut. The Bitcoin price has fallen about 28% since its all-time high in October.
At the time of publication, the bitcoin price is at $90,114.