Bitcoin surge exceeds $116,000 amid eased Federal Reserve expectations: What are the upcoming developments?

Crypto markets commenced this week with a notable increase driven by a rare convergence of favorable macroeconomic developments.

As per data from CryptoSlate, Bitcoin surged to a new intraday peak exceeding $116,000 before settling around $115,587 at the time of reporting. This marks its highest price point in several weeks and indicates that it is approaching its previous all-time high.

Ethereum mirrored this movement, advancing towards $4,200, while Solana surpassed the $200 mark. Other leading digital currencies such as BNB, Cardano, Chainlink, and Hyperliquid also experienced considerable gains during this period.

The coordinated upward trend indicated a resurgence of momentum following multiple sessions of exhaustion and consolidation among major altcoins.

Reasons for Bitcoin’s price increase

On-chain metrics imply that the surge was not solely driven by speculation.

Data from Glassnode reveals that, for the first time since the sell-off on October 10, the cumulative volume delta (CVD) for spot and futures has leveled off. This change suggests that aggressive selling pressure has finally subsided after nearly two weeks of capitulation.

Bitcoin On-Chain Data (Source: Glassnode)

Simultaneously, funding rates remain below the neutral 0.01% level, indicating that traders are not overly leveraged on the upside. In fact, funding rates briefly dipped into negative territory several times over the past fortnight, reflecting a cautious market still recuperating from its recent upheaval.

Short-dated option skews also indicate that sentiment reached significantly negative levels just prior to the onset of the uptrend, a situation that often precedes sharp reversals.

Macro indicators favor Bitcoin

Timothy Misir, head of research at BRN, informed CryptoSlate that macroeconomic news “did the heavy lifting” for BTC‘s current ascent.

He stated that reports of advancements toward a US–China trade agreement and indications of a more lenient Fed stance reduced risk premiums and prompted capital to flow into crypto.

The ensuing rally, he elaborated, has become “highly headline-dependent,” where positive news leads to significant squeezes, while any policy reversal could swiftly reverse gains.

Additionally, Misir highlighted that the rebound also resulted in widespread liquidations across derivatives markets.

Data from Coinglass indicates that approximately $365 million in short positions were liquidated within hours, impacting over 100,000 traders. Bitcoin shorts alone represented nearly $174 million of those losses.

In light of this, Misir remarked that this combination of macro easing and forced short covering produced a “short, sharp risk-on leg.”

Notably, institutional investors, particularly ETFs, corporate treasuries, and mid-sized whales, absorbed the sell-side supply and contributed to maintaining the upward momentum. However, he cautioned that the market’s structure remains delicate, with options and futures positioning leaving the front end susceptible to headline volatility.

Misir concluded:

“Treat any break above $116,000 as a potential liquidity magnet (and any failure below $108,500 as a tactical sell signal).”

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