Emre Yumlu 
Bitcoin hovered around $113,000 during Asian trading hours on Wednesday, as traders adopted a defensive stance ahead of the U.S. Federal Reserve’s (Fed) policy decision. Fading liquidity and a strengthening U.S. dollar have put pressure on risk assets across global markets, including cryptocurrencies.
Despite holding a 4.5% gain over the past week, Bitcoin slipped 0.7% in the last 24 hours. Ethereum (ETH) traded around $4,028, down 1.4%, while Solana (SOL) and Binance Coin (BNB) each lost about 2%. Meanwhile, XRP continued its strong weekly momentum, trading slightly higher near $2.62.
Market Focus: The Upcoming Fed Decision
All eyes are on the Federal Open Market Committee (FOMC) meeting scheduled for October 28–29. Analysts widely expect the Fed to cut interest rates by 25 basis points, lowering the target range to 4.00%–4.25%.
Thomas Perfumo, chief economist at Kraken, noted that macroeconomic dynamics remain the dominant driver of the current crypto cycle. “A 25 basis point cut appears highly probable this week, and the market is already pricing in another reduction by December,” Perfumo explained. “However, the October 10 sell-off reminded investors how vulnerable digital assets still are to external shocks.”
Perfumo added that the balance between institutional inflows and treasury demand has shifted, tempering short-term momentum even as long-term capital remains stable.
Liquidity Tightens as Traders Turn Defensive
According to Alice Li, a partner at Foresight Ventures, signs of renewed stress in U.S. regional banks have led to tightening liquidity conditions. “Liquidity is shrinking,” Li said. “Rising stress among regional banks could push the Fed to end its quantitative tightening (QT) cycle sooner, but inflation concerns will likely keep policymakers cautious.”
Li highlighted that liquidity on centralized exchanges has dropped to around 40% of pre-drop levels, triggering broader sell-offs across altcoins. However, exchange-linked tokens such as BNB have shown relative resilience after weeks of deleveraging.
Technical Outlook: Bitcoin Maintains Bullish Structure
From a technical standpoint, Bitcoin’s structure remains constructive. FxPro analyst Alex Kuptsikevich emphasized that BTC is still trading above both its 50-day and 200-day moving averages. “The $117K–$120K range represents a significant resistance zone, but the rebound from $108K support has preserved the bullish setup,” he noted.
The total cryptocurrency market capitalization currently stands near $3.9 trillion, staying comfortably above key moving averages. Analysts suggest that while the market has stabilized following the October 10 liquidation event, volatility could spike once again depending on the tone of Fed Chair Jerome Powell’s remarks following today’s policy announcement.
As investors await the Fed’s rate decision, all eyes remain on how macroeconomic signals will shape the next short-term move in the crypto market.
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