Crypto Daybook Americas: Pre-Fed Derisking Marked by PENGU Liquidity Squeeze

Crypto Daybook Americas: Pre-Fed Derisking Marked by PENGU Liquidity SqueezeYour day-ahead look for Dec. 18, 2024By Omkar Godbole, Shaurya Malwa|Edited by Sheldon RebackUpdated Dec 18, 2024, 2:28 p.m. UTCPublished Dec 18, 2024, 12:00 p.m. UTC By Omkar Godbole (All times ET unless indicated otherwise)The crypto market is derisking ahead of today's Fed rate decision. Everyone's buzzing about the likelihood of another rate cut that will supposedly galvanize risk-taking in the economy and financial markets.Powered By 00:00/01:481010.2K 0Blood Bath Across Crypto Markets After Fed Decision .stlp0{fill:#FF3E5F;} .st1{fill:#fffffe;} .st2{fill:#FF3E5F;}Share.clsx-1{isolation:isolate;}.clsx-2{fill:#ff3e5f;}.clsx-3{fill:#fff;}NextStayStory continues belowDon't miss another story.Subscribe to the Crypto Daybook Americas Newsletter today.See all newslettersSign me upBy signing up, you will receive emails about CoinDesk products and you agree to our terms of use and privacy policy.Here's the twist: The central bank is expected to signal three rate cuts for 2025, not the four it projected in September, as well as revise growth and inflation forecasts higher. No surprise, then, that bitcoin and ether are trading nearly 2% lower, driving bigger losses in small-cap tokens. Among them, Pudgy Penguins' PENGU token, which has slumped over 50% since Tuesday's airdrop.The front-end call premiums in both BTC and ETH have already taken a hit, signalling a more cautious vibe in the market. Traditional markets are also factoring in a hawkish cut.Now, seasoned traders will tell you that when expectations lean too heavily one way, there's always room for disappointment. Put more simply, if interest rate projections stay the same or Fed Chairman Jerome Powell eases concerns about sticky inflation during his press conference while maintaining a data-dependent approach, we could see a nice bump in risk assets — cryptos included.VIRTUAL, the native coin of AI and tokenization platform Virtuals Protocol, might shine in that case, having risen 11% in Asian hours. "AI within crypto is shaping up to be a fascinating trend, especially in social trading, where data-driven insights and automation can empower traders," said Neal Wen, head of global business development at Kronos Research.Leading on-chain perpetuals platform HyperLiquid's HYPE token is another candidate, trading 4% higher at press time. Social media chatter points to limited exchange availability and token retention as a catalyst for the rally.That said, don't let your guard down. Some observers say the pace of future rate cuts really hinges on Friday's core PCE data, the Fed's preferred inflation measure. As Valentin Fournier, an analyst at BRN, put it: "The Federal Reserve is set to announce a 25 basis-point interest-rate cut today — it's last for the year. Future cuts may rely heavily on Friday's Core PCE report, which is expected to hold steady at 3.3% year over year. Any surprises with rising inflation could rattle the markets, especially since bitcoin is already feeling some bearish pressure and is lacking the upward momentum."Additionally, the decline in Chinese government bond yields has folks over at the Wall Street Journal raising red flags about the world's second-largest economy facing a depression, a prolonged period marked by a sharp drop in economic growth and rising unemployment. These concerns could easily destabilize global markets, so it's definitely a good time to stay alert.... https://www.coindesk.com/daybook-us/2024/12/18/crypto-daybook-americas-pre-fed-derisking-marked-by-pengu-liquidity-squeeze #crypto #bitcoin #ethereum #cryptocurrency #news #blockchain #litecoin #cryptonews #cryptonewstoday #cryptoworld #cryptonewstoday ***NOT FINANCIAL, LEGAL, OR TAX ADVICE! JUST OPINION! I AM NOT AN EXPERT! I DO NOT GUARANTEE A PARTICULAR OUTCOME I HAVE NO INSIDE KNOWLEDGE! YOU NEED TO DO YOUR OWN RESEARCH AND MAKE YOUR OWN DECISIONS! THIS IS JUST ENTERTAINMENT! This information is what was found publicly on the internet. This information could’ve been doctored or misrepresented by the internet. All information is meant for public awareness and is public domain. This information is not intended to slander harm or defame any of the actors involved but to show what was said through their social media accounts. Please take this information and do your own research. bitcoin, blockchain, crypto, cryptocurrency, altcoin, investment, ethereum, bitcoin crash, xrp, cardano, ripple