The Fed cut interest rates by 25 basis points, why is Bitcoin still not rising? 

Recently, the Federal Reserve announced that it would cut the benchmark interest rate by 25 basis points, and this news has attracted widespread attention in the financial market. In traditional finance, interest rate cuts usually mean increased liquidity and lower funding costs, and investors tend to turn their attention to high-risk, high-yield assets, such as stocks and cryptocurrencies. However, it is puzzling that after the release of this good news, the price of Bitcoin did not rise as expected. The reasons involve factors at multiple levels, including market sentiment, economic environment, and Bitcoin's own characteristics.

First, market sentiment is a complex and crucial factor. Although interest rate cuts usually trigger investors' pursuit of risky assets, changes in market sentiment are often fleeting. After the news of the Fed's interest rate cut was released, the market did not show obvious optimism. On the contrary, many investors are cautious about the economic outlook, and some investors even choose to wait and see, waiting for further market signals. This psychological state directly affects the demand for Bitcoin, resulting in the price failing to rise as expected.

Second, the complexity of the global economic situation also has an impact on the price of Bitcoin. In recent years, the global economy has faced many challenges, such as geopolitical risks, inflationary pressures, and supply chain issues, which have made investors more cautious in choosing assets. Although interest rate cuts will theoretically stimulate economic growth, in practice, the speed of economic recovery is often lower than expected. Compared with traditional financial assets, Bitcoin's price volatility is greater, and many investors choose a more stable investment method when faced with uncertainty.

In addition, the market structure of Bitcoin is also worthy of attention. In recent years, the structure of participants in the Bitcoin market has changed significantly. Early Bitcoin investors were mostly technology enthusiasts and individual investors, while today, the proportion of institutional investors has gradually increased. Institutional investors are usually more rational in investment decisions, and they will comprehensively consider the macroeconomic environment, market trends, and the attributes of the asset itself. Therefore, when the Federal Reserve announces a rate cut, institutional investors may adopt a more conservative strategy, resulting in the failure of Bitcoin's price to rise.

In addition, the supply and demand relationship of Bitcoin is also a factor that cannot be ignored. The total supply of Bitcoin is limited, only 21 million, and market demand is affected by a variety of factors, including investor confidence, market liquidity, etc. In the environment of interest rate cuts, although liquidity increases in theory, if the market demand for Bitcoin does not increase significantly, then its price will naturally be difficult to rise. This is reflected in the recent market performance. Although the news of interest rate cuts has once triggered market discussions, the actual change in trading volume has not supported the upward trend of Bitcoin prices.

On the other hand, technical factors may also be one of the important reasons why Bitcoin prices have not risen. The price of Bitcoin is affected by a variety of technical indicators, such as moving averages, relative strength indexes, etc. In the short term after the announcement of the interest rate cut, the technical signals of the market were not very strong, causing many investors to choose to wait and see when the technical aspects could not be confirmed. This technical hesitation further exacerbated the market's depressed mood.

At the same time, the influence of social media and news media should not be underestimated. In today's rapid information dissemination, discussions on social media often directly affect investors' decisions. When the price of Bitcoin fails to rise, many investors may seek opinions and suggestions from others on social media, and these opinions often lead to further deterioration of market sentiment. On the contrary, if there are optimistic voices in the market, it may stimulate investors' desire to buy, thereby driving up prices.

Finally, technological innovation and market competition are also important factors affecting Bitcoin prices. In recent years, with the development of blockchain technology, more and more cryptocurrencies and financial products have entered the market, and investors' choices have become more diversified. In contrast, as the first generation of cryptocurrency, Bitcoin faces competitive pressure from emerging projects. In this case, investors may turn their funds to other projects with greater potential, thus affecting the demand for Bitcoin.

In summary, although the news of the Fed's 25 basis point interest rate cut should theoretically have a positive impact on Bitcoin prices, in reality, due to multiple factors such as market sentiment, economic environment, investor structure, supply and demand, technical factors, and the influence of social media, Bitcoin prices have failed to rise as expected. This phenomenon not only reflects the complexity of the current market, but also reminds investors to consider a variety of information and factors when making investment decisions.

In the future market, whether Bitcoin can resume its upward momentum depends on investor confidence and changes in the market environment. With the evolution of the global economic situation and the adjustment of investor psychology, the price trend of Bitcoin is still full of uncertainty. For investors, continuing to pay attention to market dynamics, analyzing economic data, and grasping technological trends will be the key to formulating effective investment strategies.

In this era of rapidly changing information, investors should have keen insight and rational thinking ability. Whether it is the traditional financial market or the cryptocurrency market, only by keeping calm and making rational analysis can we find opportunities in the volatile market. Only in this way can we seize our own wealth in the complex and changing market environment.

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The Federal Reserve cut interest rates again last night. The last time it did so was the first time in 11 years, so this time it was the second time in 11 years. However, it was just the expected rate cut. When the news came out, the US stock market fell, gold fell, and Bitcoin actually fell slightly.

The rate cut that everyone hoped for was not seen. Just like the last time, the Federal Reserve just "felt a sign" and only cut interest rates by 25 basis points. Compared with the larger rate cut that everyone thought would happen, it was still quite disappointing. The reason is actually that the Federal Reserve's recent series of operations (including the first repurchase in recent years) have made people begin to expect the start of the fourth round of quantitative easing.

However, it is not just us who are disappointed. The US President Trump is even more disappointed. He cursed the Federal Reserve on Twitter for being ignorant.

In fact, it is not the Federal Reserve's fault. The current US economy is actually quite good. To be honest, there is no basis for a rate cut. Because the premise of a rate cut is generally that economic development has encountered a bottleneck, and it is necessary to increase monetary liquidity by lowering interest rates to achieve the purpose of stimulating the economy. At present, all economic indicators in the United States, whether employment, trade, industry, etc., are good, so the Fed does think there is no need to cut interest rates, but in order to cope with the gaze of all walks of life, especially Trump, the Fed still cut interest rates a little.

To answer the question in the title, the Fed cut interest rates, why didn't Bitcoin rise? In fact, the reason is the same as that of gold and US stocks, which did not rise or even fell, because the expectation is to "cut enough" rather than "cut a little". The Fed's reduction is indeed not enough, and it is far less than people's expectations. The financial market has always been a market that plays with expectations. If expectations are not enough, it will naturally not rise.

However, the Fed's next round of quantitative easing is still exciting. The US dollar has not been properly released for many years. Not only does it make the currencies of countries around the world that rely on foreign exchange (mainly US dollars) to support the issuance of currencies very uncomfortable, but many financial assets are also looking forward to it, especially risky assets. Yes, it is the Bitcoin you are most familiar with.

Yesterday, the boss of Bitmex, Brother Xiaohei, called for Bitcoin. He said that the fourth round of quantitative easing is coming, and after that, Bitcoin will soon return to 20,000 US dollars.

If the loosening begins, that is, if the US dollar finally starts to release water, the global currency will follow suit, and then the first beneficiaries will be risky asset investments, such as Bitcoin, new stocks, technology venture capital, etc. This is the logic that everyone thinks the Fed's decision is very important for Bitcoin.

In fact, Bitcoin's trend this year is positively correlated with the US dollar, and negatively correlated with the US dollar. This shows that the Fed's decision can indeed directly affect the trend of Bitcoin, so although it will not rise in the short term, in the long run, the current expectations and the actual interest rate cuts are both good for the future price of Bitcoin, so everyone is actually optimistic about the future price trend of Bitcoin.

In short, I am optimistic.