Macro trends, Fed policy drive crypto's wild ride; check what lies ahead

The cryptocurrency markets are witnessing continued volatility, with Bitcoin slipping below $88,000 after briefly reclaiming the $90,000 mark. Ethereum mirrored the move, falling below $3,000. Currently, the global market capitalisation hovers around $3.06 trillion, while the Fear & Greed Index sits at 29, signaling prevailing market fear.

Macro sentiment tied to Fed policy

The macroeconomic sentiment for the crypto markets, analysts believe, remains closely tethered to the Federal Reserve’s policy path. Disinflation is progressing, albeit at a slower pace, dampening expectations for an early or aggressive rate cut. Meanwhile, gold and silver reached record highs amid rate-cut speculation and geopolitical uncertainties, reflecting a broader demand for hedging.

 

At the time of writing, Bitcoin was trading at $87,494, down 1.39 per cent over the past 24 hours, with a trading volume of $36.76 billion. The token fluctuated between $87,580 and $90,501 during the session, according to CoinMarketCap. Ethereum, facing heavier selling pressure, was trading below $3,000 at $2,966, down 2 per cent with a 24-hour trading volume of $19.06 billion. ETH’s session range was between $2,965 and $3,073.

 

According to Riya Sehgal, research analyst at Delta Exchange, the market sentiment remains data-dependent. "A softer US GDP print could reignite liquidity optimism heading into early 2026. Until then, crypto will likely follow equities, consolidating after ETF-driven inflows and a mid-quarter correction. Momentum recovery will need decisive closes above $89,500 for Bitcoin and $3,080 for Ether," Sehgal said.

 

She further noted that the 200-period moving average near $91,000 serves as key resistance, while $85,500 marks structural support for Bitcoin. For Ether, a similar compression is occurring between $2,950 support and $3,080 resistance, mirroring Bitcoin’s movement.

 

Ryan Lee, chief analyst at Bitget, on the other hand, expects Bitcoin and Ethereum to maintain upward momentum in the near term, in line with seasonal trends and broader equity rebounds, which have historically supported digital assets post-consolidation.

 

"For the holiday period, we anticipate Bitcoin trading in the $86,000 to $93,000 range and Ethereum between $2,800 and $3,200, supported by returning institutional inflows and potential regulatory clarity," said Lee.

Broader market view

Looking at broader market catalysts, Lee highlighted that ETF approvals or unexpected macroeconomic surprises could either amplify gains or induce short-term volatility. "Geopolitical tensions or sudden liquidity shifts remain risks, but overall, this setup favors growth in crypto markets, further reinforcing the integration between traditional finance and digital assets as we approach the close of 2025," said Lee.

 

Elsewhere, Tom Lee’s Bitmine acquired 98,852 ETH last week, bringing its total to 4,066,062 ETH, while Trump Media added 451 BTC, taking its total to 11,542 BTC, according to the CoinDCX Research Team. Meanwhile, Strategy raised its USD reserve to $2.19 billion, though no new Bitcoin purchases were made last week. Aster is set to initiate a Stage 5 buyback program on December 23, directing up to 80 per cent of its daily platform fees toward automatic and discretionary ASTER buybacks. Additionally, pro-crypto Michael Selig has been sworn in as the new chairman of the Commodity Futures Trading Commission (CFTC).