How the Crypto Market Could React to the Next Fed Meeting on October 29?

The cryptocurrency market faces potential volatility as traders anticipate the Federal Reserve's crucial October 29 meeting, with Bitcoin and major altcoins already pricing in an expected 25 basis points interest rate cut. This Fed rate decision could trigger significant price movements across the entire crypto ecosystem, including DeFi tokens and blockchain assets.

Market analysts warn of a possible "sell the news" event that could spark a cryptocurrency market crash following the announcement, even if the Fed delivers the anticipated rate reduction. Bitcoin price action and broader digital asset valuations have been closely correlated with traditional financial markets and monetary policy decisions throughout 2024.

The 25 bps rate cut expectation has already influenced crypto trading patterns, with institutional investors and retail traders positioning themselves ahead of the Fed meeting. Lower interest rates typically benefit risk assets like cryptocurrency, but the market's current pricing suggests potential downside risk if the announcement disappoints.

Traders should monitor Bitcoin dominance, trading volumes, and DeFi protocol activity as key indicators of market sentiment surrounding this pivotal Fed decision that could reshape the cryptocurrency landscape.