Bitcoin's recent rally has been dampened by a lack of new stimulus measures from China, with Beijing’s latest announcements falling short of market expectations. Subsequently, BTC experienced a decline of 1.5%, in the wake of a surge over the past few weeks that had been propelled by increasing hopes for long-term Chinese stimulus.
As the crypto market evolves, traders are now orienting their focus towards an impending Federal Reserve meeting, seeking potential market direction. The disappointment deepened when the National Development and Reform Commission (NDRC), during a Tuesday briefing, provided no concrete details regarding new measures aimed at stimulating China’s economy.
This left investors underwhelmed, especially those expecting a stronger post-holiday boost for the markets. In the aftermath of this development, the Shanghai Composite index initially jumped by 4% at market opening but ultimately closed lower, while the Hang Seng Index witnessed a nearly 7% decline, reversing earlier gains. During the late U.S.
trading hours on Monday, Bitcoin managed to briefly touch $62,000; however, it slipped back slightly to $62,700 during early Asian hours, effectively erasing much of the gains accumulated over the prior week. Several major cryptocurrencies, such as Solana (SOL), Ether (ETH), XRP, and BNB, fell by as much as 4%.
The CoinDesk 20 Index (CD20), which tracks large-cap tokens, also saw a decline of 2.18%. This lack of urgency and substantial stimulus from China coincides with growing concerns regarding conflicts in the Middle East, which compounded the negative market sentiment. As a result, many investors opted to take profits following the recent rally. As described by Zheng Shanjie, Chairman of China’s NDRC, the country’s economy remains “stable” with fundamental conditions unchanged.
In light of this, crypto traders are turning their attention to the Federal Reserve's FOMC minutes and key economic figures from August, anticipated to be released later this week. These events are likely to provide further insights into Bitcoin’s potential market trajectory in the days ahead..