Bitcoin $20k4, Ethereum $1k5 – Crypto Market Surges Ahead of Key US Macro News

The cryptocurrency market experienced a strong surge early on October 26, ahead of the Federal Reserve's interest rate decision set for early November.

On the night of October 25 and early morning of October 26, the crypto market saw a surprising breakout, ending a nearly three-week period of sideways movement.

Bitcoin (BTC) jumped from $19,237 to as high as $20,415 – its highest level since October 4 – before pulling back to around $20,100 at the time of writing.

15m Chart of BTC/USDT on Binance at 07:55 AM on October 26, 2022

Meanwhile, Ethereum (ETH) outperformed with a more than 10% increase, climbing from $1,350 to $1,525 – the highest ETH has been since September 15, when Ethereum successfully completed its historic Merge upgrade. The inflation rate of ETH has noticeably decreased post-Merge, a factor many believe will drive further gains for the coin.

15m Chart of ETH/USDT on Binance at 07:55 AM on October 26, 2022

The entire crypto market is painted green, with top 20 altcoins recording gains of 5 to 10%.

The intensity of the surge is also reflected in the liquidation of derivative positions. According to Coinglass data, nearly $800 million in derivatives were liquidated in the past 12 hours, primarily in BTC and ETH, with 88% of those being short positions.

12-Hour Crypto Liquidations Data from Coinglass at 07:55 AM on October 26, 2022

Notably, FTX recently experienced its largest liquidation event ever, with nearly $600 million in liquidations.

Many are humorously noting the arrival of "Uptober" – the term used to describe the October rally that often signals the start of year-end gains for Bitcoin and altcoins.

Upcoming US Macro News Awaiting the Crypto Market

There’s no specific news driving the crypto market's sharp recovery. However, both the crypto and traditional financial markets are bracing for a series of significant macroeconomic announcements from the US.

Firstly, at 07:30 PM (Vietnam Time) on October 27, the US will release its Q3 2022 GDP data. This is a crucial indicator of the health of the world's largest economy, which has faced recent instability due to high inflation and geopolitical tensions in Europe.

Additionally, this week will see major tech companies like Microsoft, Alphabet (Google), Meta (Facebook), Apple, and Amazon report their Q3 financial results. Google’s stock dropped significantly on the morning of October 26 following a disappointing earnings report.

On Friday, October 28, billionaire Elon Musk is expected to finalize his acquisition of Twitter, a deal that has garnered extensive media coverage due to its controversies. The success or failure of this deal is likely to impact Dogecoin (DOGE), a cryptocurrency heavily promoted by Musk and subject to significant price manipulation by whales due to Musk-related news.

Looking ahead to the following week, on the morning of November 3, the Federal Reserve will announce its latest interest rate adjustment, with financial observers predicting another 0.75% hike. In 2022, the Fed has raised rates five times from 0.25% to 3% – the highest level since the 2008 financial crisis. This is part of the Fed's efforts to control inflation, which has remained high throughout 2022.

The Fed is expected to make one more rate adjustment in December. Recent reports indicate that Fed officials have agreed to a 0.75% hike in November but are considering a lower increase in December after assessing the negative impacts of previous rate hikes on the economy.

Finally, on November 10 at 07:30 PM, the US will release October's inflation data, a report sure to drive Bitcoin and the broader crypto market, along with the US stock market, into action.