Bitcoin, along with gold and silver, experienced a significant rally on Tuesday, coinciding with expectations of another interest rate cut from the Federal Reserve. This surge has sparked discussions about the potential longevity of this rally as traders brace for volatility surrounding the Fed”s upcoming interest rate announcement.
The price of silver (XAG) has notably surged, breaking above $60 per ounce for the first time in history, marking a remarkable increase of +108% in 2025. As all eyes turn towards the Federal Reserve”s decision, market participants are keenly aware of the implications this may have on Bitcoin and the precious metals.
According to the CME FedWatch Tool, there is an estimated 87.6% probability that the Federal Reserve will announce a rate cut. A reduction in interest rates typically provides a boost for Bitcoin, as it enhances liquidity in the financial markets. Gold tends to benefit most directly from such cuts, while silver often follows with delayed performance before experiencing substantial gains during periods of strong economic recovery.
Currently, Bitcoin is trading with a bullish sentiment and is consolidating within an ascending parallel channel after reaching a low of $80,600 on November 21. The price is currently facing resistance at the 50-day Exponential Moving Average (EMA) situated at $97,015, which stands between it and the critical Fibonacci retracement level of 61.8% at $98,018. A breakthrough at this level with strong volume could signal a continued upward trend.
Should the price encounter resistance at the Fibonacci level, it may lead to a reversal, with potential downside targets around the $80,600 support level, representing a significant drop from current prices.
In the case of gold, the price could see a pullback towards the lower levels around $4,199, potentially breaching the rising support trendline. However, with the Relative Strength Index (RSI) still above 50, there remains a chance for recovery, especially if critical support levels between $4,178 and $4,192 hold. A strong resistance level is identified at $4,241, with further bullish momentum possible if this level is surpassed.
Silver is currently witnessing one of its most robust bull runs, outperforming the S&P 500 by a factor of six year-to-date. The XAG/USD price is on track for its largest annual gain since 1979. Following the establishment of a new all-time high of $60.794, silver is entering price discovery territory. The 15-minute chart indicates a bullish continuation breakout, confirming a shift from consolidation to expansion.
Overall, as long as silver maintains its position above the rising 50-EMA, the outlook remains positive for those looking to buy on dips, with the next significant targets set between $61.00 and $61.50.
In conclusion, while the anticipation of a Federal Reserve rate cut has propelled Bitcoin, gold, and silver into a rally, market participants must remain cautious of potential volatility as the decision nears.
