Remember when a single tweet from Jerome Powell could swing Bitcoin five figures in an hour? Yeah, those days never really went away — they just got a little quieter during the bear market. But right now, with BTC hovering in the low nineties and over a billion dollars in leveraged positions hanging in the balance, every single word from tomorrow’s press conference matters again.
Today, December 9, the Federal Open Market Committee starts its last meeting of 2025. By tomorrow afternoon we’ll know whether the Fed delivers the widely expected 25 basis-point cut, whether the dot plot still shows multiple cuts for 2026, and — most importantly — whether Powell sounds like the dovish friend crypto has grown to love or starts hinting that the party is getting a little too wild.
Why This Particular FOMC Feels Different
Let’s be honest: a 25 bps cut is basically priced in. CME FedWatch Tool shows probabilities dancing between 88% and 92% depending on the hour you check. That’s not excitement — that’s resignation. The real drama isn’t if they cut, but how they cut and what they say next.
In trader speak, we’re bracing for three possible flavors:
- A clean dovish cut + dot plot showing three or four more in 2026 → rocket fuel
- A cut but Powell pushes back on aggressive easing expectations → “hawkish cut” pain
- Surprise pause (tiny probability, massive volatility) → absolute chaos
The Dot Plot: The One Chart That Actually Matters
Forget the rate decision itself. The Summary of Economic Projections — especially the infamous dot plot — will tell us whether Fed officials still believe inflation is licked enough to keep cutting aggressively into next year.
Current consensus among economists points to:
- GDP growth around 2.1% for 2026 (slightly slower but still solid)
- Unemployment holding near 4.2% (basically full employment)
- Core PCE inflation cooling to about 2.5% (getting closer to the 2% target)
If the median dot for 2026 stays at three cuts or higher, crypto traders will treat it like Christmas morning. Two cuts or fewer? Expect the kind of dip that makes weak hands panic-sell at the exact bottom.
“The dot plot has become the single most important 45 minutes in crypto every quarter.”
— Veteran macro trader on Crypto Twitter, 2025
Quantitative Tightening: The Quiet Giant in the Room
Most retail traders completely ignore this part, but institutions are obsessed with it. The Fed has been shrinking its balance sheet (QT) by letting up to $25 billion in Treasuries and $35 billion in MBS roll off each month. That’s liquidity being sucked out of the system.
There’s growing chatter — some of it from Fed officials themselves — that they might slow or even pause QT in early 2026. A single sentence from Powell acknowledging that possibility would be massively bullish for risk assets, crypto included.
Why? Because slowing QT = more dollars staying in the financial system = higher valuations for everything that isn’t cash.
Current Market Positioning: A Powder Keg
Here’s where it gets spicy. As of Monday evening, crypto derivatives markets are carrying more than $1.2 billion in potential liquidations within a 5% move in either direction on Bitcoin. That’s not an exaggeration — that’s just the data.
Bitcoin is stuck in a ridiculously tight range between roughly $90,200 and $91,800 for days. That kind of compression almost always resolves with violence.
Key levels every leveraged trader is watching right now:
| Direction | Trigger Level | Est. Liquidations | Next Major Target |
| Bullish breakout | $92,000 | $120M+ shorts | $95,000–$97,000 |
| Bearish breakdown | $89,500 | $300M+ longs | $88,000 then $85,000 |
In plain English: if Powell sounds even mildly friendly tomorrow, a short squeeze could get downright ugly (for the shorts). If he sounds cautious, the cascade lower could wipe out a lot of December gains in hours.
What “Dovish” Actually Sounds Like in 2025
After three years of this cycle, we all know the code words by heart:
- “Ongoing progress toward our 2% objective” = good
- “Data-dependent” repeated five times = they’re scared to commit
- “Balanced risks” = they think they’re close to neutral
- Mention of “labor market cooling” without alarm = dovish
- Any sentence containing “above-target inflation remains a concern” = hawkish
Pro tip: watch Powell’s body language too. When he leans forward and smiles while talking about the labor market staying resilient? Buy button gets smashed. When he starts furrowing his brow and qualifying every positive statement? Maybe take some profits.
Altcoins and the Great Rotation Question
Bitcoin dominance is sitting right at that annoying 58-60% level it loves to tease us with. A super-dovish outcome tomorrow could finally kick off the altseason so many have been calling for (and that keeps not showing up).
Ethereum, in particular, looks coiled. It’s been lagging Bitcoin hard, but gas fees are creeping higher, staking yield is attractive, and the ETF narrative never really died. A friendly Fed could be the catalyst that sends ETH/BTC screaming back toward 0.04.
Solana, BNB, and the usual suspects would follow if money actually rotates. But let’s be real — until Bitcoin makes up its mind, everything else is just noise.
Institutional Flows: The Quiet Accumulation Continues
Here’s the part that keeps me bullish even when the short-term setup looks dicey. Spot Bitcoin ETFs have seen inflows for five straight days heading into this meeting. BlackRock alone added another $400 million last week while retail traders were busy arguing on Twitter.
That tells you everything you need to know about who’s actually comfortable holding through volatility. The same institutions that bought the dip in November are still buying. They’re not trying to trade Powell’s press conference — they’re positioning for the next leg higher in 2026.
My Personal Playbook for the Next 48 Hours
Full disclosure — I’ve been doing this long enough to know that trying to front-run the exact wording of a Fed statement is a fool’s game. But here’s how I’m positioned heading into tomorrow:
- Core spot holdings untouched (never sell your conviction bags on macro events)
- Some dry powder in stablecoins in case we get a nasty hawkish surprise
- A few low-leverage longs on ETH and SOL with tight stops (asymmetric upside if we rip)
- Mental stop-loss at Bitcoin $87,800 — if we close below there on daily, something went very wrong
Most importantly, I’m not married to any outcome. The Fed has made a career out of surprising markets lately. Flexibility is the only edge retail has against the algos.
Whatever happens tomorrow, remember this: we’ve survived 50% drawdowns, exchange collapses, and actual rate hikes to 5.5%. A few basis points and some careful wording from a central banker? We’ll survive that too.
But yeah… I’ll still be refreshing the live stream at 2:30 p.m. ET like everyone else.
See you on the other side.
