On the Eve of the Fed Decision: Bitcoin Breaks Strongly Through 94,500, Ethereum Nears 3,400—In-depth Market Analysis and Strategy Outlook for December 10

As the three major US stock indexes closed with divergence and CME FedWatch fixed the probability of a December rate cut at a key 87.6%, the crypto market launched another fierce offensive early this morning—Bitcoin reached as high as $94,554, Ethereum surged strongly to $3,396, and all short positions in the contract market were liquidated. This is not only a price breakout, but also the result of synchronized liquidity expectations and institutional funds. I am Wang Yibo, and today I will help you see through the surface of the candlesticks, track the core signals before the Fed policy is implemented, and grasp the real intentions behind institutional fund flows and on-chain data.

I. Anchoring the Macro Environment: Fed Rate Cut Probability and US Stock Divergence

US stock closing pattern: The Dow fell slightly by 0.37%, the Nasdaq rose by 0.13%, and the S&P 500 lost 0.09%. This divergence reflects the market's complex mindset as it weighs economic soft landing against policy uncertainty. The resilience of tech stocks shows that capital is still betting on AI and innovation, resonating with the risk appetite in the crypto market.

Fed watch: The 87.6% probability of a December rate cut and the 69.3% probability of a cumulative 25 basis point cut by January underpin current market pricing. But the real game is in the "expectation gap of cut magnitude"—if Powell sends a dovish signal tonight, hinting at a clearer 2025 rate cut path, risk assets will have greater upside; if the tone is hawkish, it may trigger profit-taking as "good news is priced in."

Crypto market’s early reaction: The fierce rally in the early morning is a sign that some informed funds are pre-positioning for a dovish outcome. The breakout at $94,500 technically confirms the short-term uptrend channel, but whether it can hold depends on tonight’s “final kick” from the Fed.

II. In-depth Bitcoin Analysis: The Momentum Code from 89,000 to 94,500

1. Price Action: Breakout with Volume and Consolidation for Strength

Yesterday, during the daytime, Bitcoin fluctuated narrowly around the $90,000 level, with mild long-short tug-of-war and cautious trading. This kind of low-volume consolidation is a typical pre-breakout pattern—when uncertainty and wait-and-see sentiment peak, any marginal positive can trigger a directional move.

In the evening session, after a brief dip to $88,950, bulls suddenly took over and launched a rapid rally. This "V-shaped reversal" indicates:

• Strong support below: $88,950 becomes a short-term strong support

• Clear bullish control: The rally had no significant pullback, showing the main force’s determination to accumulate

• Shorts’ stop-losses triggered: Shorts piled up above $92,500 were liquidated in a chain reaction, accelerating the rise

After reaching $94,500, the market entered minor consolidation. This “slow grind up with consolidation” is not a trend reversal, but a sign of normal momentum accumulation. Technically, $94,500 is the first resistance; the $95,000-$96,000 range contains the concentrated selling from bag holders at 2021 highs, and larger volume is needed to break through.

2. Technical Indicators: Ongoing Bullish Alignment

Moving averages: On the 4-hour chart, MA60 (around $89,000) and MA120 (around $87,500) are aligned bullishly, with MA60 acting as a dynamic support during pullbacks. On the daily chart, MA20 (around $90,500) has crossed above MA60, forming a golden cross and signaling a clear medium-term uptrend.

MACD: On the 4-hour chart, the histogram remains above the zero line and continues to expand, with no bearish divergence in the DIF line, indicating that the upward momentum is not exhausted. On the daily chart, MACD is about to form a golden cross; if the Fed is dovish tonight, it will confirm the weekly uptrend.

Volume: During the rally, volume expanded to 1.8 times the daily average (about $6.5 billion); during consolidation, it dropped to 1.2 times, which is a healthy price-volume relationship. If volume exceeds $8 billion on a breakout above $95,000, the main rally will be confirmed.

3. Key Levels and Strategies

• First support: $92,500 (current consolidation center)
• Second support: $90,500 (4H MA20 and psychological level coincide)
• First resistance: $94,500 (already broken, needs to hold)
• Second resistance: $96,000 (2021 high area, strong resistance)
• Third resistance: $100,000 (psychological and technical barrier)

Trading strategies:

• Current holders: Continue to hold above $92,500, reduce position by 30% if it breaks below
• Flat (no position): Wait for a pullback to $91,500-$92,500 to enter, avoid chasing highs
• Breakout chasers: If volume breaks out above $96,000, can chase, stop-loss below $94,500

III. In-depth Ethereum Analysis: Resonance of Ecosystem Recovery and Technical Strength

1. Price Action: Classic Bullish Trend Continuation

Ethereum also played out the classic “dip, surge, then consolidate” pattern yesterday:

• Daytime: Narrow range around $3,100, volatility only 1.2%
• Evening: Dipped to $3,097, quickly rebounded, with only $3 difference from open, refusing deep correction
• Rally: Peaked at $3,396, a 9.6% gain, highly synchronized with Bitcoin’s 9.8%
• Consolidation: Now fluctuating near $3,300, which is the long-short dividing line

This price action shows:

• ETH/BTC ratio stable: Maintained in the 0.034-0.035 range, no independent weakness
• Active buying: Buy orders ate through sell walls during the rally, not just stepping up bids
• On-chain capital: L2 TVL rose 3.2%, indicating that on-chain funds are actively increasing ETH exposure

2. Technical Structure: Neckline Risk and Strong Support Coexist

Moving averages: On the 4-hour chart, MA60 (around $3,150) and MA120 (around $3,080) form a golden cross, providing strong medium-term support. Daily MA20 has crossed above MA60, confirming the uptrend.

Key structure: The price is showing signs of forming a neckline at the highs. If it breaks down below $3,280-$3,300, a small double top may form with increased correction risk; if it holds above $3,300, the bullish trend is confirmed.

Volume: During the rally, volume reached 1.6 times the daily average (about $18 billion); during consolidation, it dropped to 1.1 times, healthy for a rising trend.

3. Ecosystem Drivers: Fundamentals and Technicals in Dual Drive

Fusaka upgrade effect: After L2 fee reduction, Arbitrum daily transactions increased from 850,000 to 1.2 million (+41%), Optimism from 620,000 to 910,000 (+47%). Higher on-chain activity directly increases ETH burn—1,780 ETH burned per day in December, deflation continues.

ETF expectations: If a spot ETH ETF is approved, it is expected to attract $7-10 billion in new funds in the first year. Institutions are already pre-positioning via futures, with CME ETH open interest at $8.2 billion, a record high.

Deflation model: Staked ETH has reached 34.6 million (28.7%), with burning + staking locking up supply, reducing net annual supply growth to **-0.18%**, reinforcing the scarcity narrative.

IV. Tonight’s Focus: How Will the Fed Decision Impact the Next Move?

Powell’s press conference tonight will be the decisive factor for short-term direction:

Dovish scenario: If a clear 2025 rate cut path is indicated, BTC will test $96,000-$98,000, ETH will challenge $3,500-$3,600

Neutral scenario: If the “data dependent” tone is maintained, the market will enter high-level consolidation: BTC in $92,500-$94,500, ETH in $3,280-$3,380

Hawkish scenario: If inflation risk is stressed, BTC may pull back to $90,500, ETH to test $3,150 support

On-chain monitoring: Watch for the hour after the FOMC:

• Stablecoin inflows: If net USDT/USDC inflow to exchanges exceeds $200 million, shows strong capital entry intention
• Futures OI: If open interest rises instead of falling, longs are increasing, trend continues
• Whale moves: If net exchange inflow turns negative, whales are buying the dip

V. Strategy Advice: Framework for Different Types of Investors

1. Spot Holders (Cost < $90,000)

• Strategy: Keep holding, reduce position by 20% if it breaks below $92,500 to lock in profit
• Stop-loss: Strictly set at $89,000 (4H MA60 and psychological level coincide)

2. Futures Traders (Leverage >5x)

• Strategy: Immediately reduce leverage to below 3x, or close positions and wait for the decision
• Risk control: BTC stop-loss at $91,800, ETH at $3,250

3. Waiting on the Sidelines

• Strategy: If holding above $94,500/$3,380 within one hour after the decision, enter with 30% position
• Pullback buying: If post-decision pullback to $91,500/$3,280, build 50% position

VI. Real-time Service Commitment: Continuous Tracking of Core Signals

Follow Yibo for ongoing coverage of:

• Fed policy implementation: Instant interpretation of Powell’s wording and dot plot changes
• Institutional fund flows: Monitoring ETF subscription/redemption, CME position changes
• On-chain data anomalies: Whale transfers, exchange inflows, stablecoin minting
• Strategy updates: Adjusting positions and targets as the market evolves

Investment maxim: In the crypto market, understanding macro matters ten times more than predicting candlesticks. Tonight’s decision will set the tone for December and even Q1 2025. Stay calm, practice strict risk control, and real opportunities belong to those who are prepared.

What scenario do you think the Fed decision will bring tonight?

A. Dovish beyond expectations, ignites the market

B. Neutral balance, high-level consolidation

C. Unexpectedly hawkish, triggers correction

Comment your choice and reasoning below; the most-voted option will receive a pre-market strategy analysis tomorrow!

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