- Lark Davis says rate cut odds for December just slipped by 31%.
- What could have been a bullish sign may now push a bearish market reaction.
- Explore what this could mean for the crypto market going forward.
As Bitcoin and Ethereum prices fall to even lower price targets, analysts grow more anxious and expect a greater crash to come for the crypto market. Some analysts hold on to hope for a bullish recovery using several possible catalysts that could drive a massive flood of liquidity into the markets soon. Amidst the latest market updates, Lark Davis says rate cut odds for December just slipped to 31%.
Lark Davis Says Rate Cut Odds for December Just Slipped to 31%
Ever since August, the tides had begun to shift for the crypto market. In fact, all financial markets were seeing dynamic moves that could have meant a myriad of changes for the following quarters. While a handful of analysts predicted a bearish market to ensue, others saw multiple indicators that suggested a great wave of liquidity would flow into the crypto market over the coming months.
To highlight, one of the most bullish indicators suggesting this surge of liquidity was that the price of gold topped. This often meant that capital rotation would occur, leading to funds from low-risk assets like gold and silver to flow into high-risk assets like crypto and stocks. Another factor was that Bitcoin always follow the M2 money supply chart, which had also topped recently, signaling another price pump possibility for BTC.
But what has happened instead is that the price of BTC seems to be seeing a heavy decline in price, taking ETH and the rest of the crypto market down with it. Another factor that set up bullish hope was the fact that the Fed was announcing rate cuts. After a few months’ delay, despite President Trump demanding rate cuts, the Fed only announced a small cut after certain criteria were met.
As we can see from the post above, rate cuts for December was highly expected, but now Lark Davis says that rate cut odds for December just slipped to 31%. This could have an inverse effect for crypto, which falls in line with the many bearish expectations that most analysts have been turning to over the past few weeks.
What Does This Mean for Crypto
In detail, Lark Davis marks the reason for the low probability of rate cuts in December due to the following reason. He says that the US Bureau of Labor and Statistics announced there won’t be any October jobs report, and the November job report will be coming after the FOMC meeting. This means Powell will be flying blind into the FOMC meeting, and the market is assuming he’ll play it safe and won’t cut rates. Thus, he concludes that this is probably why Bitcoin price fell to the $86,000 price range.
