Bitcoin breaks through $94,000, and the Fed's interest rate decision will start a battle for $100,000

After a week of sideways consolidation, Bitcoin suddenly gained momentum on December 9, with the price breaking through the $94,000 mark strongly, sweeping away the previous dull trend in the $88,000 to $92,000 range. This breakout was driven by a combination of concentrated accumulation of whale addresses and over $300 million in short contract liquidations, while the U.S. Office of the Comptroller of the Currency’s (OCC) clarification on banks’ involvement in cryptocurrency transactions and market expectations for the Federal Reserve’s interest rate cut provided key macro sentiment fuel for the rally. Currently, the market is focused on the upcoming Federal Reserve interest rate decision, which may determine whether Bitcoin can hit the historic $100,000 mark in one go.

Market review: Why did Bitcoin suddenly “pull green onions in dry land”?

On December 9, Beijing time, the Bitcoin market experienced a long-lost explosive market. In just a few minutes, the price quickly pulled from a narrow range near $92,000 to over $94,000, completely breaking the “sticky” consolidation pattern that had lasted for nearly a week. This rapid breakout usually signifies a sudden change in market structure, and on-chain data and data from the derivatives market reveal the driving force behind it.

The primary driver comes from whale buying. Data shows that within an hour before the price started, thousands of bitcoins flowed into multiple large-value custody addresses related to institutions and exchanges. This intensive accumulation behavior in a short period of time is often seen as a signal for “smart money” or large liquidity providers to enter the layout. Their buying orders first eat up the liquidity on the sell book, thinning the market depth and setting the stage for subsequent rapid price movements.

This was followed by a series of liquidations of short contracts. The sharp rise in price has caused a large number of leveraged short positions betting on range-bound or falling to hit the liquidation line. This forced closing behavior itself creates additional buying pressure, creating a positive feedback loop of “rising → liquidating shorts → further rising”, which is often referred to as a “short squeeze” market. Judging from the results, this mechanism is vividly demonstrated in this round of rise.

Crypto market key liquidation data

Total market-wide liquidations in the last 12 hours: Over $300 million

Bitcoin Short Liquidations: Over $46 million

Ethereum short liquidation: Over $49 million

Dominant Type: Over 70% for short position liquidation

This series of data clearly shows that this round of market is not driven by moderate incremental funds, but a typical technical breakthrough triggered by spot accumulation and exacerbated by the collapse of leverage in the derivatives market.

Macro catalysis: regulatory warmth resonates with expectations of interest rate cuts

In addition to technical factors within the market, two key macro news have formed a perfect resonance at the time point, which has greatly boosted the overall risk appetite of the market. Firstly, the Office of the Comptroller of the Currency (OCC) issued a significant policy clarification confirming that U.S. federal chartered banks can participate in cryptocurrency transactions as a “risk-free mandate.” This means that banks can act as intermediaries to process crypto asset transactions without directly holding them, essentially removing a key barrier for traditional financial institutions to enter the crypto market more securely and compliantly.

This policy is interpreted by the market as a positive regulatory development, lowering the barriers and concerns for institutional participation and potentially expanding Bitcoin’s buyside pool. Shortly after the news was announced, the market started a breakout market, and the timing was not accidental, reflecting investors’ immediate pricing of the long-term positive effect of “institutional channel broadening”.

At the same time, the focus of the market has already been on the upcoming Federal Open Market Committee (FOMC) meeting. According to data from the CME FedWatch tool, the market is betting on an 87.6% probability that the Fed will announce a rate cut at this meeting. Expectations of interest rate cuts mean a more accommodative liquidity environment, and Bitcoin, as a “digital asset” highly sensitive to global liquidity, has historically been seen as a potential beneficiary. On top of the microstructural benefits brought about by the OCC news, strong expectations of interest rate cuts provide macro narrative support for the rise, which together constitute an “emotional catalyst” driving a price breakout.

Simultaneous changes in traditional assets: a rehearsal of macro liquidity expectations

Bitcoin’s breakout is not an isolated case, and a closer look at the traditional safe-haven asset market reveals the same macro logic at play. Gold and silver prices also saw significant increases during the same period, especially when silver prices exceeded $60 per ounce for the first time in history, a staggering increase during the year. This synchronized movement across asset classes strongly suggests that the core force driving the market is a shared macro expectation – a bet on the Federal Reserve’s shift to accommodative monetary policy.

Historical experience shows that when the interest rate cut cycle begins or expectations are strong, gold often reacts first due to its financial attributes and safe-haven characteristics. Bitcoin, which is increasingly regarded as “digital gold” by some investors, has begun to show a certain correlation with gold, especially at the node when liquidity expectations change. The explosive rise of silver usually occurs in the phase of strong inflation or re-trading expectations, and its volatility is much higher than that of gold. The current simultaneous strength of Bitcoin, gold, and silver can be seen as the market voting for “easy trading” with real money.

The significance of this phenomenon for the Bitcoin market is that it further verifies that the driving force of this round of market is not limited to the crypto ecosystem (such as ETF inflows or a technological upgrade) but is rooted in the broader global macroeconomic narrative. This may mean that Bitcoin is becoming more deeply integrated into the global macro asset framework, and its price fluctuations will be more affected by traditional financial variables such as interest rates and liquidity.

Technical Outlook: Is there a sea of stars or a profit-taking zone ahead?

The breakthrough has already occurred, and the next question the market is most concerned about: can the rise be sustained? Through technical analysis, we can outline several key signposts and potential risk areas. Bitcoin price is currently maintaining an ascending channel since November lows, with the overall structure remaining bullish. Immediate overhead resistance is near the 50-day Exponential Moving Average (EMA) at around $97,000, along with a key Fibonacci retracement level at $98,000.

! Bitcoin Price Prediction

(Source: TradingView)

If the buying force is strong enough to effectively break through the resistance zone of $98,000 with high volume, then market sentiment will be further ignited, and the next target level may rise to the $103,000 to $105,000 range, which will officially start the impact on the psychological mark of $100,000. Momentum indicators such as the Relative Strength Index (RSI) also indicate that buyer strength is gaining, supporting the possibility of further upside.

However, the risks cannot be ignored. First of all, the market’s expectations for the Fed’s interest rate cut are already quite sufficient, which is a “known positive”. If there are any surprises in the outcome of the meeting (such as standing still or releasing hawkish signals), it may trigger a profit-taking of “buy expectations, sell facts”. Secondly, the rapid increase and extremely high financing interest rates in the short term have accumulated pressure on a pullback. Key support needs to focus on breaking out near the starting point of $92,000, as well as the lower band of the ascending channel. If the price falls back below $92,000, it may mean that this breakout is invalid and the market will return to a wide range of volatility.

Conclusion

Bitcoin’s breakthrough of $94,000 this time is the result of the resonance of three factors: market microstructure (whale accumulation, short squeezing), improved regulatory environment (OCC policy), and macro expectations (Fed rate cuts). It marks the market’s choice of direction from the dull range consolidation in the early stage, reigniting the imagination of an all-time high and even the $100,000 mark. However, it is still necessary to remain sober after the carnival: the outcome of the Fed meeting will be an important litmus test for short-term trends, and the continued rise will require more incremental funds, especially ETF flows, to be confirmed. For investors, while paying attention to the vast space above, sticking to key support levels and managing leverage risks is a more rational posture in this battle for the “100,000 mark”. The market is moving from a mere halving narrative to a more complex phase that dances with global liquidity.