According to BlockBeats, on March 20th, QCP released a daily market observation stating that last night's FOMC meeting brought a long-awaited upward catalyst to the market, pushing the price of Bitcoin to break through $85000 and experience a significant increase. The Federal Reserve has decided to reduce its' quantitative tightening 'program starting from April. The market interprets this as an indirect interest rate cut, reinforcing people's expectations that the Federal Reserve will begin easing policy as early as June. As of the time of writing this article, the market expects three interest rate cuts in 2025, in June, September, and December.
Apart from the excitement in front of us, the tone of the Federal Reserve is clearly cautious. Policy makers have lowered their economic growth expectations to 1.7% (a decrease of 0.4 percentage points), while raising their inflation expectations to 2.8%, indicating that the risk of stagflation is increasing. In addition, the Federal Reserve's dot matrix shows a more hawkish shift compared to December last year, with the number of officials expected to not cut interest rates in 2025 increasing to four.
In terms of the options market, the market positioning has returned to normal, and the bias has shifted back to call options. This is in sharp contrast to the situation earlier this week where there was a bias towards put options. The key test now will come when the US market opens tonight.
