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Bitcoin Surges After Fed’s First 2025 Rate Cut
Bitcoin price climbed back above $117,000 following the Federal Reserve’s first interest rate reduction of the year, lifting sentiment across risk assets and crypto markets. At press time BTC was trading at $117,476, up 0.9% on the day and roughly 3% for the week, while 24-hour spot trading volume jumped 49.6% to $60.9 billion — a sign of renewed participation after a subdued September.
Derivatives Activity Signals Growing Risk Appetite
Derivatives metrics showed even stronger activity: BTC futures volume rose 65.9% to $119.8 billion and open interest increased 1.6% to $85.7 billion, according to Coinglass data. A simultaneous rise in volume and open interest typically indicates traders are opening fresh leveraged positions rather than merely closing existing ones, which can precede larger directional moves and higher volatility in the near term.
Why traders are watching open interest
Rising open interest alongside surging futures volume often reflects new capital entering the market. For crypto traders and institutional participants, this combination can be an early indicator of sustained momentum in Bitcoin price and heightened liquidity needs across exchanges.
Fed Decision and Macro Context
The Federal Open Market Committee voted 11-1 on Sept. 17 to reduce the federal funds rate by 25 basis points to a 4.00%–4.25% range — the Fed’s first cut since December 2024. The move was attributed in part to a rise in unemployment to 4.3% in August, the highest level since 2021. Chair Jerome Powell framed the adjustment as a risk-management step that balances employment concerns with ongoing inflation above target (headline CPI at 2.9%, core CPI at 3.1%).
The rate cut weakened the U.S. dollar, lifted equity markets and improved liquidity expectations for risk assets, including cryptocurrencies. Industry voices note that lower short-term yields make tech, innovation and staking-focused digital assets relatively more attractive versus government-backed fixed income.
Technical Outlook for Bitcoin
Bitcoin is trading in the upper half of its Bollinger Bands, with near-term resistance around $118,700 and support near $112,900. The 10-day and 20-day moving averages sit below the current price, reinforcing a short-term bullish bias. The RSI at about 62 shows neutral momentum trending toward overbought, while MACD presents a buy signal. Momentum oscillators such as the Stochastic RSI and Williams %R are approaching overbought levels, suggesting traders should monitor key levels closely.
Bitcoin daily chart
In a bullish scenario, a decisive break above $118,700 could pave the way toward retesting the mid-August high near $124,128. On the downside, failure to hold $115,000 would likely put the 100-day SMA (around $111,600) back in focus as the next major support level.
Source: crypto
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