Bitcoin Market Sees Rising Fakeouts as Whales Drive Volatility Ahead of FOMC Decisions

• Whales trigger Bitcoin fakeouts as traders react to FOMC decisions.
• Smart money selloffs reshape crypto market behavior amid interest rate cuts.
• Bitcoin drops sharply as crowd expectations clash with whale-driven trends.

The crypto market continues to witness unpredictable movements as traders react to key economic policy updates in the United States. According to Santiment’s data and analytics professional Brian Quinlivan, Bitcoin investors displayed a familiar behavioral trend ahead of the latest Federal Open Market Committee (FOMC) meeting. He explained that traders showed signs of fear and uncertainty before the announcement, which eventually led to significant volatility.

Quinlivan noted that Bitcoin experienced multiple fakeouts during the buildup to the latest interest rate cut. These movements created confusion among retail traders who were expecting a rally. Following the announcement, large investors known as “smart money” reportedly sold off their holdings in a three-wave pattern. This activity came right after the Federal Reserve Chair’s hawkish remarks, which sparked a sharp downturn across the market.

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Smart Money and the Shift in Market Behavior

Besides the usual optimism that surrounds interest rate cuts, the crypto market this time reacted differently. Historically, lower interest rates increase investor appetite for risk assets like Bitcoin. However, 2025 has reflected a new pattern described by analysts as “Buy the Rumor, Sell the News.” Quinlivan pointed out that this trend has occurred several times this year, indicating a shift in market sentiment and investor strategy.

Moreover, trading data from Santiment shows that large wallets and whales have been the driving force behind these fakeouts. While the broader market expects price surges during major announcements, big investors often take the opposite direction. This has resulted in frequent shakeouts, leaving retail traders at a disadvantage.

Consequently, Bitcoin’s price dropped by 8.7% last week after the FOMC meeting, falling to $106,303 before finding a new support level. The U.S. Federal Reserve confirmed plans to continue rate cuts in the coming months and end quantitative tightening by December 1. Despite these policies, the crypto market remains highly sensitive to the actions of institutional players.

According to Quinlivan, traders should closely monitor the recurring three-wave pattern surrounding major economic events. He emphasized that recognizing this setup could help investors avoid falling for short-term market traps engineered by larger players.

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