The "Fed Watch" tool over at CME has been updated again— the probability of a 25 basis point rate cut in December is now 85.1%, while the likelihood of no cut is only 14.9%.

This number was less than 50% a week ago, how did it suddenly skyrocket?

Two reasons. First, several recent Fed officials' speeches have a "dovish" tone, meaning that lowering interest rates and controlling inflation are not in conflict; second, the economic data is indeed a bit underwhelming—consumer spending is declining, and the job market is also cooling down, so not lowering interest rates doesn't make sense.

Bitcoin has recently climbed back to around 90,000 from over 80,000, largely due to the anticipation being factored in early. But don't expect it to take off immediately once the news breaks; it's more likely to stabilize first, then funds will gradually flow in, before initiating a new round of growth.

**What should retail investors do now?**

Don't panic sell, and don't leverage to the max to bet on direction. When the market is volatile, emotional trading is the easiest way to lose money.

If you plan to hold Bitcoin for the long term, dollar-cost averaging is a safe choice—buying a fixed amount regularly, regardless of short-term fluctuations. If you intend to hold for a long time, you might consider earning some returns on your assets through staking or blue-chip DeFi lending.

One more thing: in the early stages of interest rate cuts, money usually flows into leading cryptocurrencies like Bitcoin first, and only later rotates into other tokens. So don't rush to chase altcoins.

**Keep an eye on mid-December**

The Fed meeting is the key juncture. Before this, the market will trade based on expectations rather than facts. If you want to get ahead in the next round of market movements, now is the time to formulate a plan instead of waiting for the news to come out and then following the trend.

Do you think there will really be a rate cut this time? Are your positions ready? Let's chat in the comments.