Global financial markets are experiencing tension ahead of the anticipated meeting of the U.S. Federal Reserve. Investors are watching for signals about potential rate cuts and inflation trends, which also impact the cryptocurrency market.
Bitcoin Wobbles Amid Geopolitical Tensions
Bitcoin briefly topped $108,000 in early U.S. hours on Monday before sliding to $106,500 on profit-taking. It later bounced back above $107,000 during Asian trading on Tuesday. The movement follows Friday’s $1.2 billion in futures liquidations, which forced out overleveraged traders and weighed heavily on altcoins through the weekend.
Despite the choppy action, Bitcoin ETFs pulled in $1.4 billion in net inflows last week, reinforcing their growing role as stabilizers during volatile periods. Analysts suggest Bitcoin’s slow response to macroeconomic stress could change if investors seek alternative safe-haven assets.
"Bitcoin typically lags behind gold and oil during geopolitical events, but if risk sentiment turns, BTC could quickly regain momentum," said Eugene Cheung of OSL.
XRP Leads as Altcoins Recover
While most major altcoins are still recovering from the weekend drawdown, XRP stood out with a strong rebound. XRP, the fourth-largest cryptocurrency, is trading at $2.17 with a 0.77% daily gain, backed by a $128.23 billion market cap and $1.74 billion in volume. It continues to hold a strong position, supported by growing interest in institutional banking integration. Ethereum ticked up 1.5% to $2,609 but continued to trail Bitcoin’s ETF-fueled performance. Solana and Tron also posted modest gains, but sentiment across altcoins remains cautious.
Meanwhile, Gold and oil surged early Monday after U.S. President Donald Trump unexpectedly urged the evacuation of Tehran during the G7 summit. The geopolitical jolt sent investors rushing into defensive assets, while Bitcoin’s response remained subdued.
Fed in the Spotlight
All eyes are now on the Fed. Market watchers expect interest rates to remain unchanged, but the tone of Chair Jerome Powell’s remarks could set the course for crypto and equities alike. With inflation easing and jobs data holding firm, officials may opt for patience, though some, like SignalPlus’ Augustine Fan, believe a dovish tilt could be signaled subtly.
The near-term outlook remains tied to the Fed’s message and the unfolding tensions in the Middle East.
Global and cryptocurrency markets continue to face pressure from uncertainties driven by both economic and geopolitical factors. Investor sentiment and regulatory positions will play a crucial role in future developments.
