Bitcoin News Today: Fed's Inflation Stalemate Sparks Bitcoin Plunge: JPMorgan's Bearish Warning

Bitcoin's price has retreated below $112,000, erasing recent gains, as JPMorgan's CEO Jamie Dimon warned the Federal Reserve may face constraints in cutting interest rates further due to persistent inflation. The cryptocurrency, which had briefly surged past $118,000 last week, now trades near $111,000 amid heightened market volatility. Dimon's remarks, delivered during a CNBC-TV18 interview, emphasized that inflation "seems a little bit stuck at 3%" and that additional rate cuts would depend on economic data rather than political pressure. This sentiment aligns with broader market skepticism, as traders brace for key U.S. economic releases, including GDP figures and the core PCE price index, which could influence the Fed's policy trajectory.

The Federal Reserve's recent 25-basis-point rate cut in September, the first since December 2024, has not alleviated concerns about inflation resilience. Dimon noted that while the Fed might prefer to cut rates in response to a recession, its ability to do so hinges on inflation trends rather than economic growth. Treasury Secretary Scott Bessent echoed this tension, criticizing Fed Chair Jerome Powell for not advocating more aggressively for rate reductions. Bessent argued that "rates are too restrictive" and called for a 100-150 basis-point cut by year-end. Meanwhile, Chicago Fed President Austan Goolsbee signaled potential resistance to further cuts at upcoming FOMC meetings, citing inflation risks.

Technical indicators for Bitcoin suggest bearish momentum. A doji candle formed at critical resistance levels on the weekly chart, signaling hesitation among bulls. The pattern, combined with a "dragonfly doji" on the dollar index (DXY), which tracks the U.S. dollar against major currencies, points to a potential shift in market sentiment. The DXY's bullish reversal at key support levels (96.37) implies dollar strength could persist, pressuring risk assets like Bitcoin. Analysts highlight that Bitcoin's retreat below the Ichimoku cloud and the breakdown of a long-term trendline from 2017 and 2021 bull markets reinforce the bearish case. Immediate support levels are identified at $114,473 and the psychological $107,300 threshold.

JPMorgan's "sell the news" warning extends to equities, with the S&P 500 having surged 30% since April but remaining vulnerable to risks such as inflation, weak jobs data, and trade tariffs. The bank recommended hedging strategies like purchasing VIX calls and gold to mitigate potential market corrections. Given the historical correlation between stocks and crypto, Bitcoin could mirror equities' movements, either rallying with rate cut optimism or crashing alongside a stock sell-off. This interdependence underscores the interconnectedness of global financial markets, where Fed policy decisions carry cascading effects across asset classes.

Upcoming data releases and Fed speeches will be critical in shaping near-term sentiment. The core PCE index, the Fed's preferred inflation metric, is expected to show a 2.7% annual rise in August, slightly higher than July's reading. A sharper-than-anticipated inflation print could delay rate cuts and weigh on Bitcoin, while softer data might reinforce dovish expectations. Analysts also highlighted that September, historically a weak month for crypto, could see mixed outcomes. While some coins exhibit breakout momentum, others remain range-bound, with Lark Davis, a prominent crypto trader, expressing cautious optimism for Q4 performance.

Sources:

[1] Forbes Digital Assets (https://www.forbes.com/sites/digital-assets/2025/09/25/jpmorgans-ceo-just-issued-a-stark-fed-warning-as-bitcoin-price-crash-fears-swirl/)

[2] CoinDesk (https://www.coindesk.com/markets/2025/09/22/bitcoin-bulls-challenged-by-dollar-s-doji-xrp-macd-bearish-ahead-of-fed-speak-and-pce-inflation)

[3] TradingView (https://www.tradingview.com/news/u_today:4dbedab35094b:0-fed-s-rate-cut-may-push-markets-down-jp-morgan-warns-will-this-impact-bitcoin/)