ICYMI: Markets tumble after latest Fed signals

The final Fed meeting of 2025 has come and gone, and major assets are posting declines at the time of writing:

• Bitcoin is now hovering around the $90k level, having tested its 21-day simple moving average (SMA) for support.

The 21-day SMA has been an important support level, highlighted by Chief Market Analyst Han Tan in our special Dec 9 livestream previewing this Fed rate decision.

• Gold (Bybit: XAUUSD+) is now testing its 9-day SMA for immediate support - another key technical indicator previously highlighted in our Dec 9 livestream.

• Despite climbing to within 0.2% of its all-time high of 6928.62 (posted on Oct 30), Bybit's SP500 - which tracks the benchmark S&P 500 - swiftly pulled away from near-record high levels to post a one-week low.

Trade SP500, XAUUSD+, and more on Bybit MT5 here.

What did the Fed actually do and say on Dec 10, 2025?

• The FOMC did cut benchmark rates by 25-basis points (bps) - as widely expected.
• The Fed's dot plot telegraphed just 1 more rate cut in 2026
• However, following the final Fed rate decision of 2025, markets still anticipate 2 more rate cuts (25 bps each) in 2026, with a 21% chance of a 3rd rate cut over the next 12 months.
• Also, there were 3 Fed officials who voted against the 25-bps cut triggered at yesterday's (Wed, Dec 10) meeting. This is the first time since 2019 where there have been 3 dissenting voices.
• Still, risk assets initially cheered Fed Chair Jerome Powell's optimism that trade tariffs' impact on US inflation should fade after Q1 2026, while US economic growth should stay resilient in the coming year.

Such mixed signals likely added to the topsy-turvy post-Fed moves across asset classes.

Although the US dollar has weakened against most of its G10 peers as expected*, yet Gold has been unable to take advantage of the weaker 'buck', while cryptos and stocks were dented by deteriorating risk appetite following Oracle's disappointing earnings results.

*a currency tends to weaken at the thought of its country's interest rates going down

Did you miss out?

There's been plenty of volatility in the hours following the Fed rate decision, producing long and short opportunities galore for short-term traders.

Let's see how the actual moves stack up against the market's forecasts, which we previously shared during our Dec 9 livestream and published in yesterday's (Wed, Dec 10) article:

Bitcoin (forecasts: 2% up or down)

- as much as 2.2% up

- as much as 1.56% down

- peak to trough decline: 5.37% at the time of writing

Ethereum (forecasts: 2.5% up / 3% down)

- as much as 2% up

- as much as 3.6% down

- peak to trough decline: 8.1% at the time of writing

Ripple (forecasts: 2.6% up / 4.2% down)

- as much as 2% up

- as much as 2.3% down

- peak to trough decline: 4.2% matching forecasts for the 6-hour window

Solana (forecasts: 3.3% up / 3% down)

- as much as 3.5% up

- as much as 3.1% down

- peak to trough decline: 9.5% at the time of writing

Gold (forecasts: 0.28% up / 1.5% down)

- as much as 1.1% up

- peak to trough ascent: 1.6%, though XAUUSD+ has since pared much of its gains following the Fed rate decision

S&P 500 (forecasts: 1.3% up or down)

- as much as 0.9% up

- as much as 1.3% down from peak to trough, at the time of writing, matching forecasts

EURUSD (forecast: 0.2% up / 0.8% down)

- as much as 0.44% up, though EURUSD has pared some of its gains since

NOTES:

Forecasted and actual % moves above were for the 6 hours after yesterday's Fed rate decision.

Forecasts were based off 1 standard deviation of each asset's reactions to Fed rate decisions over the past 12 months

What's next?

The Fed watch is still on, with markets shifting attentions to key US economic data releases due in the days ahead:

• Thur, Dec 11: weekly initial jobless claims
• Tue, Dec 16: November nonfarm payrolls (NFP) a.k.a. US jobs report
• Thur, Dec 18: November consumer price index (CPI) a.k.a. US inflation

After all, these types of data directly feeds into the Fed's dual mandate: "maximum employment" and "stable prices'.

In other words, after all the volatility overnight, there are bound to be more Fed-related market moves in the near future.