Despite the US Federal Reserve’s third consecutive 25 basis points rate cut, the crypto market is experiencing a sharp pullback. Investors had anticipated this move, but Jerome Powell’s hawkish commentary has sparked fears of stagflation, sending risk assets like Bitcoin and altcoins tumbling. The total crypto market capitalization has dropped 5.6% from yesterday’s peak, now hovering around $3.05 trillion.
Bitcoin (BTC) is down 2.5% over the last 24 hours, Ethereum (ETH) has slipped 3.5%, and major altcoins are bleeding red. Solana (SOL) shed 6%, Cardano (ADA) fell 7%, and Pump.fun (PUMP) leads the losers in the top 100 with a 9% plunge. Yet, not everything is doom and gloom—one token is bucking the trend with massive gains.
In this in-depth analysis, we’ll break down the key drivers behind today’s crypto dip, examine critical support levels, and outline what traders should watch next. If you’re wondering why is the crypto market down today, read on for clarity amid the chaos.
The Federal Reserve’s decision to cut rates by 25 bps was no surprise—markets had priced it in weeks ago. However, Chair Jerome Powell’s post-announcement remarks shifted the narrative dramatically. He highlighted a “cooling” labor market alongside “somewhat elevated” inflation, fueling concerns over stagflation: a toxic mix of stagnant growth and persistent price pressures.
Stagflation is kryptonite for risk assets like cryptocurrencies. Higher interest rates stifle borrowing and spending, while sticky inflation erodes purchasing power. Equities and crypto sold off in tandem, with the total crypto market cap shedding nearly $179 billion since yesterday’s high. This level now tests support at $3.01 trillion—a break below could cascade toward $2.73 trillion.
For crypto investors, this underscores a harsh reality: monetary policy trumps hype. Even with rate cuts, the Fed’s caution means tighter conditions ahead, pressuring speculative assets.
Bitcoin remains the market’s anchor, down 2.5% but resilient above the pivotal $90,000 support. This level has held firm despite over $437 million in leveraged liquidations in the 12 hours following the Fed news—including $161 million in BTC alone.
The liquidation cascade amplified the downside, but BTC’s structure intact suggests buyers are defending key zones. Here’s the technical roadmap:
| Level | Type | Implication |
|---|---|---|
| $90,000 | Support | Critical hold; break risks deeper correction. |
| $88,100 | Support | Next line of defense. |
| $94,600 | Resistance | Daily close above neutralizes sell-off. |
| $98,900 | Resistance | Bullish target on momentum rebuild. |
Polymarket bettors have slashed odds of BTC hitting $100,000 by year-end to around 30%, reflecting dimmed momentum into late 2025. Still, as long as $90K holds, the downside is capped—position for bounces, but scale in cautiously.
The altcoin sector mirrors Bitcoin’s woes but with amplified volatility. Ethereum dipped 3.5%, Solana lost 6%, and Cardano shed 7%. Among top 100 tokens, Pump.fun (PUMP) is the standout loser, down 9.1% today and 40% over the past month.
PUMP, trading near $0.0027, faces intense sell pressure. A drop below $0.0026 eyes $0.0024 support, confirming bearish control. Bulls need $0.0032 to spark recovery toward $0.0036.
PUMP’s meme-driven hype is fading in this risk-off environment, highlighting how speculative tokens suffer most in macro headwinds.
Broader altcoin pain stems from leveraged unwindings and profit-taking after recent rallies. Large-caps like SOL and ADA, tied to DeFi and smart contracts, are sensitive to liquidity squeezes.
Not all news is bearish. The relaunched Terra 2.0 chain—now simply Terra LUNA—surged 44% in the last day, pushing its 7-day gains past 200%. Note: This is distinct from the legacy Terra Classic (LUNC).
What’s driving LUNA? Ecosystem revamps, renewed developer activity, and speculative fervor around its stablecoin pivot. In a sea of red, such outliers remind us that crypto’s alpha often hides in niche narratives.
Today’s dip answers why is the crypto market down today: a priced-in rate cut met hawkish reality, igniting stagflation fears and liquidation spirals. Yet, the market isn’t broken—key supports are holding.
Historically, post-Fed volatility fades within days. With BTC above $90K and outliers like LUNA shining, dip-buyers could emerge. Stay vigilant: crypto trades on sentiment, and today’s tension may flip to tomorrow’s relief rally.
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