[New York Coin Market] Bitcoin rebounds after sharp drop, recovers $91,000… What are the main factors?

Source: BlockMedia Original Title: [New York Coin Market] “It was a planned sell-off”… Bitcoin rebounds to $91,000 after a plunge—what’s the next variable? Original Link: Ahead of the US Federal Open Market Committee (FOMC) meeting, Bitcoin managed to rebound despite whale selling and a cascade of liquidations. Over the weekend, selling pressure targeted the thinly liquid market, but expectations for the Fed’s short-term liquidity supply and rate cuts spurred dip buying, quickly restoring the price.

Bitcoin (BTC) is trading at $91,487, up 2.23% over the past 24 hours. At one point, it plunged into the $87,000 range, but strong buying brought it back above the $91,000 mark.

Sharp rebound after whale selling, $300 million losses from both-side liquidations

The weekend plunge began as 15,565 BTC (about $1.4 billion) was sold in a concentrated burst over one hour, mainly from whale wallets and major exchanges.

The market interprets this as a “planned sell-off targeting weekend liquidity.” In the derivatives market, about $346.67 million in long and short positions were forcibly liquidated in one day, maximizing volatility.

Experts believe this dramatic swing is not mere market noise, but may indicate structural liquidity manipulation. Some analysis suggests that if Bitcoin breaks through $93,000, an additional $1 billion in short positions could be liquidated.

Fed liquidity supply expectations remain

The rapid rebound after Bitcoin’s plunge is attributed to expectations for a Fed rate cut and recent short-term liquidity injections. The market sees a high probability of a 0.25 percentage point rate cut at this FOMC meeting, heightening expectations for a medium-term monetary easing cycle.

Earlier this month, the Fed supplied $1.35 billion in overnight repo (Repurchase Agreement) liquidity to the short-term funding market. This reflects increased short-term dollar demand and is viewed as a positive factor for liquidity-sensitive assets like Bitcoin.

Ethereum strong, XRP weak

Major altcoins showed mixed movements. Ethereum (ETH) is trading at $3,135, up 3.35% and up 3.15% for the week. Cardano (ADA) surged 4.45% to $0.4322, while Solana (SOL) rose 2.66%. Bitcoin Cash (BCH) continued its uptrend, gaining 0.94%.

In contrast, XRP fell 5.37% for the week, while Dogecoin (DOGE) also dropped 5.44%, remaining relatively weak.

Layer 1 leads recovery, investor sentiment still fearful

Technical rebounds among Layer 1 coins led the market recovery, while low-liquidity assets such as meme coins continued to underperform. The total market capitalization is $3.14 trillion, down slightly from the previous day, but the CMC20 altcoin index rose 2.25%, signaling partial recovery.

The Alternative Fear & Greed Index, which measures investor sentiment, recorded 25, remaining at the “fear” level. This reflects ongoing uncertainty from whale selling, increased liquidations, and the FOMC meeting.

Key variable: Bank of Japan rate hike and global bond market impact

Another key variable for the market this week is whether the Bank of Japan (BOJ) will raise interest rates. Some are concerned about potential carry trade unwinding due to a stronger yen, but experts are focusing on more structural risks.

An InvestingLive Asia-Pacific currency analyst said, “The BOJ’s rate hike has already been priced in by the market, and Japan’s 10-year government bond yield has exceeded 1.9%. The real risk is that higher Japanese rates could drive up global bond yields, putting pressure on risk assets across the board.”