IG’s Chief Analyst Expects Bitcoin to Recover Upon This Week’s Fed Rate Cut

Bitcoin and the broader crypto market continue to face a difficult stretch, yet IG’s Chief Market Analyst Chris Beauchamp says a turnaround may already be forming. 

After months of selling pressure and fading confidence, Beauchamp expects a rebound to play out this week as traders position ahead of an almost certain Federal Reserve rate cut.

IG’s Beauchamp Expects Bitcoin to Recover Upon Rate Cut

Notably, Bitcoin’s troubles started soon after it surged to a new all-time high of $126,272 in October. The rally quickly stalled, and BTC slipped into steady declines, finishing October with a 3.95% loss, and now changing hands around $90,211.

This weakness deepened in November when Bitcoin dropped another 17.5%, its worst monthly performance since February 2025, dragging the entire crypto market lower. Specifically, the global crypto market value fell from its October peak of $4.27 trillion to $3.08 trillion at press time, wiping out $1.19 trillion in just two months.

However, despite the steep losses, Beauchamp believes stabilization could be imminent. He recently pointed directly to the upcoming Federal Open Market Committee meeting on Dec. 9-10, which marks the Fed’s final policy decision of 2025. 

December Rate Cut Almost Certain

Interestingly, markets widely expect the Fed to cut rates again. The central bank already delivered 25-basis-point cuts in both September and October, bringing the target range down to 3.75%-4.00%. Another quarter-point cut this week would push the range to 3.50%-3.75%.

Market odds overwhelmingly support this move. For context, the CME FedWatch Tool shows an 89.5% chance of a December cut, up sharply from 30% in November. Futures markets also price in an 86% probability of the same outcome. 

Moreover, economists share a similar view. Out of 108 economists in a recent Reuters poll, 89 expect the Fed to cut again as it responds to a cooling labor market. Major firms offer matching forecasts. 

Looking further, T. Rowe Price believes rates could fall to 3% or lower next year as labor conditions soften further. Meanwhile, Morgan Stanley reversed its previous call for no December cut and now expects a 25-basis-point move, noting that it acted too quickly in its earlier stance. 

As for JPMorgan, the bank predicts cuts in both December and January, while Bank of America expects a December reduction followed by two more in 2026. Berenberg thinks the recent uptick in unemployment likely pushed Fed officials toward easing.

Lower Rates Attract Liquidity

Considering these odds, Beauchamp argues that lower rates usually unlock new interest in risk assets, especially after major pullbacks create more attractive buy levels. 

He pointed out that Bitcoin and Ethereum both attracted buyers during their recent weekend dips, which suggests that the market may already be forming a short-term bottom. To him, a December cut could easily restore momentum after the sharp reversal that followed Bitcoin’s record-setting surge in October.

Still, the Fed heads into the meeting with plenty of internal tension. Minutes from the October gathering revealed a deep split among policymakers. Notably, several members pushed back against further cuts, and up to five voting officials still oppose additional easing. 

Fed Chair Jerome Powell continues to walk a tightrope between those internal concerns and the economic challenges outside. He recently explained that limited data from the temporary government shutdown made October a difficult period for decision-making, comparing the situation to driving through fog. 

Currently, inflation remains above the Fed’s 2% goal and has stayed there since March 2021. Economists expect the Personal Consumption Expenditures index to remain above target through 2027.