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Bitcoin surged above $115,000 on Monday, marking its fifth consecutive day of gains as traders aggressively positioned themselves ahead of the Federal Reserve’s highly anticipated interest rate decision and celebrated a breakthrough in U.S.-China trade negotiations.
The world’s largest cryptocurrency touched a high of $115,956 during Asian trading hours, recovering nearly half of its steep losses from the October 10th crash to $103,000. Ethereum (ETH) followed the rally, breaking past $4,200 and reclaiming its key 50-day moving average.
Trade Deals and Rate-Cut Hopes Fuel Rally
The crypto surge accelerated after U.S. Treasury Secretary Scott Bessent announced on October 26 that negotiators had reached a “very substantial framework” following two days of talks in Malaysia. The agreement successfully removes the threat of 100% tariffs on Chinese goods, which had been scheduled for November 1, while also securing a pause on China’s rare-earth export restrictions.
“President Trump gave me great leverage with the tariff threat,” Bessent said, adding that the framework “will allow us to talk about many other things with China.”
The market is also overwhelmingly confident in a policy pivot from the Fed. According to the CME FedWatch Tool, traders are pricing in a 96.7% probability of a 25-basis-point interest rate cut at the Fed’s October 29 meeting. This expectation was bolstered by September’s inflation data, which came in at 3% year-over-year (below the 3.1% forecast), strengthening the case for monetary easing.
Short Squeeze Amplifies the Move
The sharp rally triggered a massive liquidation cascade in the derivatives market. According to data from CoinGlass, $319 million in short positions were liquidated in the last 24 hours.
The total crypto market cap rose 1.9% to $3.92 trillion, with Bitcoin’s market dominance climbing to 59.1%. As Bitcoin broke the psychologically important $112,000 level, trading volume surged to approximately 318% above the intraday average, confirming genuine buying interest.
“Crypto’s recent rally is being supported by an improved macro backdrop—specifically, softer US CPI data reinforcing Fed rate cut expectations,” noted LMAX strategist Joel Kruger.
Technical analysts are now setting their sights on the $120,000 resistance level as Bitcoin’s next major hurdle. Some are even forecasting a potential target of $134,100 based on a descending wedge breakout pattern.
