Trade War Tensions Ease as FOMC Looms: Bitcoin Poised for Explosive Breakout?
Markets breathe cautious relief as U.S.-China trade hostilities enter temporary calm phase
FOMC Meeting: The Main Event
All eyes turn to Federal Reserve policymakers as they convene amid cooling inflation signals. Rate decision could trigger massive capital rotation into alternative assets.
Bitcoin's Perfect Storm
Traditional finance uncertainty meets cryptocurrency momentum. Institutional adoption continues accelerating while retail FOMO builds. Technical indicators suggest potential parabolic move brewing.
Global liquidity conditions remain extraordinarily accommodative despite central bank posturing. Smart money already positioning for next leg up in digital asset markets.
Because nothing says 'stable monetary policy' like watching Fed officials flip-flop while Bitcoin quietly builds generational wealth for early adopters.
(Source: Coingecko)
US China Trade War Calm Ahead of FOMC
Part of this recovery stems from positive news from Asia, where Donald TRUMP is currently on tour. Following discussions that concluded yesterday, October 26, in Kuala Lumpur, Malaysia, there are indications that a major framework agreement addressing contentious issues will be finalized when Trump meets with Xi Jinping this Thursday.
Most importantly, it is reported that China agreed to freeze its production of rare earth metals for one year. The new export rules, which forced Trump to announce tariffs of over 100% on Chinese goods earlier this month, were, and still are, the major source of friction, a top priority as resolutions are needed.
In exchange for the one-year delay, the United States will hold off its threats to impose new +100% tariffs on Chinese goods, a move that, if implemented, WOULD likely cause major disruptions across industries in China.
Additionally, China, which has been shifting to Latin America, specifically Brazil, will increase its soybean imports from the United States. In return, the United States will reportedly relax specific export controls and, crucially, adjust pot fees that have been imposed on China.
These key deals come as the crypto world expects the Federal Reserve to slash rates later this month. According to the FedWatch Tool, there is a 97% probability that the central bank will reduce its funds rate by 25 basis points at the next meeting.
(Source: FedWatch)
If the FOMC and Jerome Powell also end up being dovish in their press conference, not only will BTC USDT tick higher, but there is also a likelihood that some of the top solana meme coins will rally.
Bitcoin News: Expect A Parabolic Move to $126,000?
Technically, the path of least resistance is southwards.
BTC USD prices remain within the bearish bar of October 10.
For this to shift, there must be a sharp close above $116,000, accompanied by expanding trading volume.
The bitcoin price must also stay above the psychological round number at $100,000 and October 2025 lows. If this prints out, buyers will likely breach $126,000, soaring to fresh all-time highs in Q4 2025.
A lax monetary policy will provide the much-needed tailwinds. In the short to medium term, one trader on X thinks the Bitcoin price is headed to nearly $122,000, the 1.38 Fibonacci extension level. For this to happen, BTC USDT must first close above $114,000.
$BTC: The price has broken above $114,026, so I’ve removed the orange scenario from the chart. The price may now target the 1.38 Fib extension level at $121,846. pic.twitter.com/yRseV0qq7D
— Man of Bitcoin (@Manofbitcoin) October 27, 2025
Amid this bullish price action, BTC holders are moving coins away from centralized exchanges at the “fastest rate in history.” By the time the analyst shared this data, there were only 2.4M BTC held across all centralized exchanges.
HISTORIC SIGNAL:
BITCOIN RESERVES ON EXCHANGES JUST COLLAPSED TO 2.4M BTC.
COINS ARE LEAVING EXCHANGES AT THE FASTEST RATE IN HISTORY.
WHEN SUPPLY DRIES UP, PRICE DOESN’T STAY LOW FOR LONG. pic.twitter.com/ruxy8Ybo46
— Merlijn The Trader (@MerlijnTrader) October 26, 2025
Typically, it is a positive signal when coins are moved from custodial ramps. With coins under the control of holders, it becomes incredibly hard to swap for fiat.
Bitcoin News: U.S.-China Trade Deals Ahead Of FOMC
- U.S. and China seek to resolve trade frictions
- Rare earth metal export controls might be delayed by a year
- China to import more soybeans from U.S.
- Bitcoin news: Will BTC USDT fly to over $126,000?
