Bitcoin Eyes $100K as Fed Rate Cut Sparks Rally

Bitcoin (BTC) is trading near a crucial resistance zone as investors anticipate this week’s Federal Reserve interest-rate decision. Market analysts suggest that if the Fed proceeds with its widely expected 25-basis-point rate cut, a strong year-end Santa rally could propel Bitcoin toward the key $100,000 psychological benchmark, a level many traders have been watching closely throughout 2025.

Fed Rate Cut Expectations Drive Renewed Bullish Momentum

Investor sentiment across risk assets has strengthened as expectations grow for a December rate cut. Lower interest rates generally weaken the U.S. dollar and increase liquidity in financial markets conditions that historically support growth in the cryptocurrency sector. For Bitcoin, which often reacts positively to improved risk appetite, this week’s Fed outcome could become a make-or-break moment.

Analysts believe that a rate cut would reinforce bullish momentum already forming in the market. Bitcoin has repeatedly tested resistance zones in recent weeks, and a fresh surge of liquidity could trigger a breakout.

Key Technical Levels: BTC Eyes $94K-$98K Breakout Range

Bitcoin continues to hover above important support around the $92,000 range, while technical analysts highlight a resistance band between $94,000 and $98,000. A decisive break above this zone could open a clear pathway toward $100,000, a psychological milestone that has historically triggered increased trading volume and retail participation.

On the downside, Bitcoin maintains a strong support cluster near $87,000-$88,000. Should the Fed take a more hawkish stance or delay the expected rate cut, BTC could revisit this support area before attempting another move higher. Still, institutional inflows into Bitcoin investment products have been improving, suggesting resilient demand even during periods of macro uncertainty.

Will the Santa Rally Deliver Bitcoin’s Next Major Breakout?

With the year coming to a close, traders are increasingly focused on the possibility of a Santa rally a market phenomenon where asset prices rise in late December. In crypto markets, this effect can be amplified due to lighter holiday liquidity and heightened speculative activity. If the Fed confirms the anticipated rate cut, Bitcoin could benefit from both macroeconomic support and seasonal trading patterns at the same time.

While some financial institutions have moderated their long-term forecasts, many still believe Bitcoin reaching six-figure territory is achievable within the current cycle. The next 48 hours may determine whether BTC finishes the year on a bullish trajectory or stalls below key resistance levels.

FAQs

1. Could Bitcoin reach $100,000 after the Fed rate cut?

Yes, analysts believe a rate cut could fuel a strong rally. If Bitcoin breaks above the $94K–$98K resistance range, momentum could carry it toward the $100,000 level.

2. What is a Santa rally in crypto?

A Santa rally is a year-end surge in asset prices, often occurring in late December. In crypto, it refers to seasonal price increases driven by improved sentiment and lighter trading conditions.

3. What are the major Bitcoin support and resistance levels?

Current key levels include support at $87K -$88K and resistance at $94K-$98K. A breakout above resistance could lead to a push toward $100K.

4. How does a Fed rate cut affect Bitcoin?

Lower rates increase liquidity and reduce the appeal of traditional yield-based assets, often boosting demand for Bitcoin and other cryptocurrencies.

5. Is it smart to buy Bitcoin before the Fed decision?

It depends on risk tolerance. The Fed announcement typically causes high volatility, so traders may wait for clarity while long-term investors often hold through such events.