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The Fed is the real crypto story, Bitcoin and Ethereum are just following

The Fed is the real crypto story, Bitcoin and Ethereum are just following

We have entered a cautious stretch. Bitcoin has slipped 0.72 per cent over the past 24 hours to US$76,697.14. Ethereum has fallen harder, down 1.95 per cent to US$2,474.93. This pullback reflects a broader market decline of 0.99 per cent. The dominant force behind this move is macro uncertainty ahead of the Federal Reserve’s September 16 interest rate decision.

Traders are pricing in a high probability of a rate hike. That expectation has triggered risk-off sentiment across financial markets. A cascade of leveraged long liquidations has added pressure. My own view is simple. This is not a crypto story right now. This is a Fed story.

Bitcoin and Ethereum are trading as risk assets. Their next major move will come from the central bank, not from their own networks or adoption trends. The market-wide nature of this decline matters. Bitcoin does not show a unique weakness. It follows the same liquidity and policy expectations that shape other risk assets. That is why I focus on the Fed rather than on crypto-specific headlines.

Bitcoin’s decline looks modest on its own. Its alignment with the broader market matters more. The total crypto market cap has fallen 0.99 per cent. Bitcoin’s 0.72 per cent drop closely mirrors that move. This correlation tells me Bitcoin is following market beta rather than reacting to a coin-specific catalyst. The derivatives data shows a sharp spike in liquidations, up 1,331.93 per cent in 24 hours. That number sounds dramatic. This is a symptom of the sell-off and a leverage flush, not the primary cause. Forced selling from over-leveraged longs can accelerate a decline. It does not create the original spark. The provided data did not show a clear secondary driver for Bitcoin. I found no specific news event, exploit, or technical failure that explains the move independently of the macro backdrop.

The near-term path for Bitcoin depends on one level. The US$76,000 support zone is critical. If Bitcoin holds above US$76,000, a rebound toward US$78,500 is possible. A break below that support would risk a drop to US$74,000. This makes the Fed’s decision and its commentary on September 16 the key watch point. The market is in a holding pattern. Bitcoin sits at the centre of that wait. There is no need to overinterpret the small percentage decline. The larger signal is that traders have reduced risk ahead of a major policy event. Liquidity expectations and rate projections now matter more than short-term chart patterns for the largest cryptocurrency.

Ethereum faces a more difficult setup. Its 1.95 per cent decline to US$2,474.93 means it has underperformed a slightly weaker Bitcoin. The primary driver is a technical rejection at the US$2,530 to US$2,550 resistance zone. That area has drawn attention from multiple analysts as a critical ceiling. Ethereum tested it and failed to break through. This rejection occurred alongside rising Treasury yields and tightening macro expectations for a Fed rate hike. Those forces dampen appetite for risk assets like crypto. The provided data showed no clear coin-specific catalyst.

The move aligns with broader macro-driven caution. In my view, Ethereum’s underperformance makes sense. It faced a technical barrier and macro headwinds at the same time. Ethereum’s failure at resistance carries more weight because it happened during a macro-sensitive window. Traders already faced rising Treasury yields. A high probability of a Fed rate hike made them less willing to chase a breakout. The rejection at US$2,530 to US$2,550 gave them a reason to sell.

Forced selling from derivative liquidations amplified Ethereum’s decline. Liquidations wiped out over US$8.9M in ETH positions recently. One post highlighted US$8.9M in ETH liquidations at the US$2,523 level. The majority came from longs. That kind of forced selling creates short-term downward pressure. It does not necessarily reflect a fundamental shift in sentiment. A flush of over-leveraged traders exacerbated the drop. This is a common feature in volatile markets. This as a leverage cleanout rather than a verdict on Ethereum’s long-term value. The technical rejection gave the initial push. The liquidation cascade turned that push into a faster slide.

The near-term outlook for Ethereum is neutral to bearish while it remains below US$2,550. If ETH holds above the US$2,450 support, it could regroup for another attempt at the US$2,550 resistance. A decisive break below US$2,450 would target the next significant support zone around US$2,350 to US$2,400. Short-term moving averages converge in that zone. The critical event remains the Federal Open Market Committee meeting concluding September 16.

Market-implied probability for a hike is high. That creates uncertainty. The Fed’s policy statement and any changes in rate projections will likely drive the next significant move across crypto markets. My bias here is cautious. Ethereum needs to defend US$2,450 through the Fed announcement. A hawkish surprise could trigger a deeper correction toward US$2,350. I would treat the US$2,450 support as the line that separates a pause from a deeper move. A hold there keeps the current range intact. A break there shifts the focus to US$2,350 to US$2,400.

My point of view on this entire setup is that the crypto market is trading on macro beta, not on its own fundamentals. Bitcoin’s slight dip is a function of macro-driven, market-wide risk aversion ahead of a key Fed meeting. A flush of leveraged long positions amplified that move. The move lacks a distinct, coin-specific catalyst.

Ethereum’s pullback combines a failed technical breakout with pre-Fed risk reduction. Derivative liquidations added fuel. I would watch Bitcoin at US$76,000 and Ethereum at US$2,450. Those levels define the near-term battle lines. If support holds, both assets can attempt rebounds. Bitcoin could target US$78,500. Ethereum could retest US$2,550. If support breaks, Bitcoin risks US$74,000. Ethereum risks US$2,350 to US$2,400.

The broader market outlook is neutral to cautious for Bitcoin and cautiously bearish for Ethereum. The Fed’s interest rate decision and forward guidance on September 16 will set the tone for Bitcoin and other risk assets. Until that event passes, I expect choppy, headline-driven price action. The modest Bitcoin decline does not alarm me on its own. The Ethereum underperformance deserves more attention because it combines technical rejection, macro pressure, and a leverage flush. Both assets are waiting on the same catalyst. That catalyst is the Fed. The market has already moved into a defensive stance. Now it waits to see whether the central bank confirms or challenges that caution.

 

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Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author. The latest book is Web4: The Age of Autonomous Intelligence.

www.anndy.com
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Bitcoin drops to US$76,796.54 as 91% S&P 500 correlation exposes crypto’s macro trap

Bitcoin drops to US$76,796.54 as 91% S&P 500 correlation exposes crypto’s macro trap

The crypto market is working through a sharp pullback. In the last 24 hours, total market cap fell 1.74 per cent to US$2.62T. Bitcoin led the decline. The largest digital asset dropped 1.87 per cent to US$76,796.54. This move did not happen alone. It tracked a broader sell-off across traditional finance. The 91 per cent correlation with the S&P 500 shows macro forces are driving price action. That link matters because crypto is trading as a risk asset, not as a safe haven.

The US PPI for August arrived on September 10 and served as the main trigger. Annual inflation reached 5.4 per cent. That result came in above expectations. The data revived fears that the Federal Reserve will raise rates or keep policy tight. Treasury yields moved higher. Stocks, gold, and crypto all fell at the same time. Bitcoin sold off as liquidity concerns and weaker investor appetite hit risk markets. The next test is the CPI report on September 11. That print will shape the odds of a rate hike before the Fed meeting on September 15-16.

Market structure made the drop worse. A wave of long liquidations hit the derivatives market. Over 24 hours, forced liquidations closed US$96.53M in BTC positions. Long bets made up 90 per cent of that total. Total open interest had risen 10.84 per cent before the move. New leverage had entered the system. When prices turned lower, forced selling created a feedback loop. That loop added downward pressure beyond what the inflation report alone would suggest. The same pattern appeared across the wider market. BTC liquidations totalled US$96.53M over 24 hours, up 16.35 per cent. Open interest across derivatives rose 9.11 per cent to US$462.13B. High leverage remains a clear risk.

Sentiment has cooled. The Fear & Greed Index fell from 75 last week to 67. That shift moved the mood from extreme greed to caution. The total market cap broke below its pivot point of US$2.61T. It also fell under its seven-day moving average of US$2.67T. The August rally has lost momentum. The sector is now in a corrective phase as speculative heat leaves the market. The RSI(7) sits at 30.02. That reading suggests the market is nearing oversold territory. If buyers return, the decline could slow.

For Bitcoin, the immediate test is the US$76,000 to US$76,350 range. This zone reflects the average cost basis for active investors. Buyers have defended it many times. If the price holds above this support, Bitcoin could stabilise and trade between US$76,000 and US$79,400 before the CPI release. A decisive break below US$76,000 would open a path toward US$73,000. A close above US$79,400 would signal a return to the uptrend.

For the total market, the path depends on the US$2.59T level. That level matches the 23.6 per cent Fibonacci support. A hold there could lead to range-bound trading between US$2.59T and US$2.67T. A daily close below US$2.59T would target the next support at US$2.51T, the 38.2 per cent Fibonacci level. A US$2.67T reclaim would indicate stabilisation. The market remains in a corrective phase within a larger uptrend. It is still up 19.65 per cent over 30 days. The key question is whether support attracts buyers or whether liquidations drive a deeper flush.

Macro data will likely decide the next move. The CPI release is the major cue. A hot reading could extend the risk-off mood and trigger another leg down. A cooler reading could give buyers a reason to step in. The correlation with the S&P 500 reached 91 per cent and 92 per cent in two readings. The link with gold reached 87 per cent. This highlights how sensitive crypto has become to macro liquidity sentiment. This is not a market-moving story on its own. It is moving with the broader financial system.

On the regulatory front, Senate Republicans released a revised CLARITY Act. The bill runs 630 pages. It aims to establish a federal framework for digital assets while tightening regulations on non-decentralised DeFi and stablecoins. Senator Cynthia Lummis led the effort. The text includes more than 100 changes requested by Democrats. It rebrands Title I as the Lummis-Gillibrand Responsible Financial Innovation Act of 2026. Lawmakers designed the bill as a broad federal framework rather than a narrow crypto adjustment.

The revised bill would split oversight between the SEC and CFTC. It would formalise how regulators would oversee exchanges, brokers, and protocols. It introduces detailed language for non-decentralised finance protocols that people or groups can control or materially alter. Those protocols would have to register with the CFTC. The text narrows DeFi rules to spot and cash digital commodities. For DeFi, the bill draws a line between genuinely decentralised protocols and those that are decentralised in name only. Participating in governance or security councils does not, by itself, constitute control. Protocols that identifiable actors can steer would be subject to CFTC registration and rulemaking. That rulemaking would focus on spot and cash digital commodity markets and address concerns about prediction markets and similar products.

Payment stablecoins would face a ban on passive interest or yield on idle balances. The bill would still allow activity-based rewards under negotiated language in Section 404. The White House and industry regard this compromise as settled. Bank lobbying continues. Developer protections remain. They aim to shield non-controlling software authors from being treated as money transmitters simply for publishing code.

If Congress enacts it, major DeFi and stablecoin projects operating in the United States would need clearer compliance strategies. Many pure-protocol developers could gain a safer legal footing. This mix could reshape compliance planning for large platforms while offering greater protection for developers who do not control user funds or protocol decisions.

The next step is a cloture vote on 15 September 2026. The motion requires 60 senators to agree to proceed. Republicans hold 53 seats. At least seven Democrats or independents must support it. Some Democratic aides call unresolved ethics disputes the biggest stumbling block. Law enforcement and banking groups push competing changes to ethics and stablecoin language. Prediction markets and research desks assign relatively low odds that the bill will become law in 2026. Failure at this stage could push comprehensive US crypto legislation back several years. That outcome would leave SEC and CFTC rulemaking as the main path for crypto regulation. Confidence in the text and vote timing is moderate because multiple independent reports agree. Political outcomes remain uncertain.

The revised CLARITY Act is the most concrete attempt so far to give US crypto markets a formal federal rulebook, especially for DeFi, exchanges, and stablecoins. Whether it advances on 15 September will shape how quickly US based projects can plan around stable rules rather than piecemeal regulation. Crypto users should watch that vote and any follow-up agency rulemaking as key signals for the regulatory regime they will face.

In my view, the current dip is a natural cooldown after a strong monthly rally, which a leverage unwind sharpened. The high correlation with traditional markets shows that crypto remains sensitive to macro liquidity sentiment. The near-term outlook is cautiously bearish. Momentum has shifted to sellers. Stability depends on holding the key support zone. Bitcoin must defend US$76,000 in the hours leading up to the CPI release. If it fails, macro fears could trigger another leg down. If it holds, the market may find room to consolidate and wait for clearer data.

 

Source: https://e27.co/bitcoin-drops-to-us76796-54-as-91-sp-500-correlation-exposes-cryptos-macro-trap-20260911/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author. The latest book is Web4: The Age of Autonomous Intelligence.

www.anndy.com
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Will Bitcoin hold US$77,000 or drag the market to US$2.51T? The September 10 answer

Will Bitcoin hold US$77,000 or drag the market to US$2.51T? The September 10 answer

The global cryptocurrency sector experienced a slight contraction today, with total digital asset valuation down 0.75 per cent to US$2.66T. This downward movement primarily stems from investors taking profits after a robust multi-week upward trend. Market participants actively shifted their capital back toward the leading virtual coin.

Interestingly, this crypto consolidation exhibits no direct correlation with traditional macroeconomic indicators. Traditional financial markets face their own distinct set of pressures today. I view this current token behaviour as a highly specific internal consolidation rather than a broader financial panic. Traders simply decided to lock in their profits after an extended period of uninterrupted price appreciation.

This deliberate action highlights a mature ecosystem where participants rationally manage their risk exposure without succumbing to blind fear. The blockchain environment currently operates on its own internal mechanics while external equity markets grapple with entirely different fundamental challenges.

External financial markets indeed suffered significant setbacks today. Global equities and government bonds declined sharply as energy prices surged and borrowing costs increased. Brent crude oil prices climbed past the US$100 mark to top US$101 per barrel. Escalating geopolitical tensions in the Middle East directly fuelled fears of energy disruptions.

Simultaneously, the United States government executed a US$6 billion debt buyback plan that disappointed institutional investors. This disappointment pushed the 10-year US Treasury yield to its highest level since 2023. The benchmark S&P 500 index consequently fell for three consecutive sessions as inflation anxieties and interest rate concerns mounted heavily across Wall Street.

Financial derivatives markets currently price in a 62 per cent probability that the Federal Reserve will implement a 0.25 interest rate increase on September 16. Asian equity markets followed this negative trajectory and were positioned for substantial declines as regional investors reacted to energy-driven inflation fears.

Returning to the virtual coin sector, the primary catalyst for the current valuation correction involves routine profit-taking following a remarkable 20 per cent monthly rally. The total crypto capitalisation successfully gained 20.23 per cent over the past 30 days before hitting a recent local peak. Such a substantial and rapid increase in valuation naturally incentivises early buyers to sell their holdings and realise their gains.

We witnessed this exact behaviour materialise in real time as the 24-hour spot trading volume jumped exactly 18 per cent to reach a massive US$86.96B. This heightened selling activity clearly signals that traders actively chose to secure their capital rather than hold through a potential correction. I consider this specific volume spike a completely normal and healthy reaction to a sustained advance. The ecosystem simply requires time to digest these recent gains and establish a solid foundation for any future upward movements.

This modest pullback represents a typical phase in the cycle rather than a fundamental structural breakdown. Buyers and sellers are currently negotiating fair value following an aggressive upward move. Observers now closely monitor whether the broader crypto landscape maintains its position above the crucial 30-day simple moving average, which sits precisely at US$2.51T. Holding above this specific technical level would strongly indicate that buyers still control the broader narrative despite the short-term profit-taking.

A failure to defend this moving average might invite additional sellers and accelerate the current downward momentum. The current structure remains entirely intact as long as valuations respect these key historical support zones. The ongoing action merely reflects a necessary cooling-off period after weeks of relentless buying pressure and speculative enthusiasm. Participants now wait for fresh capital injections to drive the next major valuation expansion across the entire digital asset space.

A secondary but equally important factor driving the current dynamics is a clear rotation of capital away from altcoins and back toward the premier cryptocurrency. The dominance metric for the leading virtual coin remains at an impressive 59.03 per cent. This high dominance figure clearly illustrates that institutional and retail investors actively prefer the relative safety of the largest crypto during periods of uncertainty.

Concurrently, the Altcoin Season Index plunged exactly 23.53 per cent over the last 24 hours. This dramatic drop in the index perfectly captures the widespread abandonment of smaller speculative assets. Investors currently rotate their funds defensively into the premier digital asset to protect their capital from extreme volatility. I observe this defensive rotation as a classic risk-management strategy that typically occurs when participants anticipate broader economic turbulence or sector-specific corrections. A sustained rise in dominance above 60 per cent would confirm a prolonged period of outperformance for the largest asset.

The derivatives arena simultaneously underwent a significant deleveraging event, further contributing to the spot valuation decline. Total open interest across major perpetual futures contracts declined by 3.93 per cent as leveraged speculators rapidly unwound their overly optimistic positions. This reduction in open interest indicates that traders actively closed out their borrowed positions to avoid potential liquidation cascades.

Furthermore, perpetual funding rates fell sharply by 38 per cent. Lower funding rates mean that buyers no longer pay a massive premium to maintain their long positions. This derivatives reset significantly reduces systemic risk within the broader financial ecosystem. This deleveraging process is an incredibly positive development for long-term health.

Excessive leverage often triggers violent swings and unnecessary crashes. The current unwinding of these leveraged positions creates a much cleaner and more stable environment for genuine spot buyers to accumulate assets at fair valuations without facing artificial price suppression from forced liquidations.

The near-term outlook hinges on the premier digital asset’s ability to defend the crucial US$77,000 to US$78,000 zone. A decisive break below this support level could trigger algorithmic selling and push the total valuation down toward the 38.2 per cent Fibonacci retracement at US$2.51T.

Conversely, a strong bounce from this support zone would likely initiate another aggressive upward leg. Market participants also eagerly await the upcoming United States Consumer Price Index data release and the next major spot exchange-traded fund flow report arriving on September 10.

These specific macroeconomic and institutional data points will serve as the primary catalysts for the next major directional move. I expect the environment to remain in a short-term consolidation phase within a much broader macroeconomic uptrend until these crucial data points provide clear guidance to institutional investors looking to deploy fresh capital into the digital asset ecosystem.

 

Source: https://e27.co/will-bitcoin-hold-us77000-or-drag-the-market-to-us2-51t-the-september-10-answer-20260910/

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author. The latest book is Web4: The Age of Autonomous Intelligence.

www.anndy.com
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