The crypto market has suddenly turned green after a slight pullback ahead of the outcome of the FOMC meeting tomorrow.
Crypto market analytics firm Santiment said on 16 September that there is a strong positive sentiment coming from investors, which could be the reason behind the rally.
It further stated that there’s a high bullish sentiment across social media, but the rally should be approached with caution as things may not go the way many expect.
Rate cut fuels confidence
There is a high anticipation of rate cuts as the outcome of the ongoing FOMC meeting which ends tomorrow.
This is usually a bullish sign for crypto investors as more people are emboldened to borrow money and invest in high-risk assets like crypto, causing prices to rise.
The high expectation of a rate cut comes from president Donald Trump’s open criticism of the Fed chairman Jerome Powell, saying the Fed needs to cut rates.
The president has severally tweeted saying a significant rate cut is required to strengthen the U.S. economy.
Crypto assets rally
Top crypto assets have started rallying with this expectation in mind, with BNB leading the top ten at 3.9% gain in the last 24 hours.
Similarly, Bitcoin is up 1.4%, bringing the price to over $116,500 at the time of reporting. Several mid-cap assets are also gaining momentum and the rally is expected to grow stronger according to Santiment.
However, the firm also advises caution, as the market usually goes in the opposite direction to retail investors’ sentiment.
If the rate cut does not happen, Santiment warns that many retail investors could be caught off guard in a sudden market correction following such a resolve by the FOMC.
What do you think?
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