Bitcoin punched through $86,500 on Tuesday, trading near $86,559 and up 12.2% over the past week, after clearing the resistance band that had capped the rally since early September. The move lifted total cryptocurrency market capitalization above $3 trillion, with the Crypto Fear & Greed Index reading 79—solidly in "greed" territory—and the Altcoin Season Index at 49, meaning Bitcoin still leads even as altcoins begin to move.

A Broader Risk-On Backdrop on Wall Street

The breakout lines up with a broader risk-on mood on Wall Street. The Nasdaq Composite closed at a record on Monday, jumping 2.26% for its best single day since June, as AI-linked names ripped higher: Intel jumped 12%, and AMD gained about 10% while crossing a $1 trillion market capitalization—a milestone only a handful of public companies have reached. Chipmakers carried their momentum into Tuesday, marking their longest winning stretch since April.

Tuesday's session itself was calmer. The Nasdaq was up 0.4% and touched a fresh intraday high, while the S&P 500 barely budged. Oil did the heavy lifting instead.

Brent crude briefly slipped below $98 a barrel and WTI fell under $93, their lowest levels since September 8, after reports that Iran offered to reopen the Strait of Hormuz within days if Washington eases pressure. Hormuz is one of the world's most important chokepoints for oil shipments, which is why even talk of reopening it can move crude. President Donald Trump told the U.N. General Assembly that he expects a deal with Iran "right after the election," referring to November's midterm vote, while Saudi Arabia works to restart its East-West pipeline by the weekend—a line that carries Saudi crude to Red Sea export terminals and offers an outlet around the strait.

The Fed Hikes While Liquidity Keeps Flowing

The Federal Reserve raised its benchmark rate by 25 basis points to 3.75%-4% on September 16, its first hike since 2023, in a unanimous 12-0 vote. Hot inflation data forced the move: the Producer Price Index accelerated to 5.4% annually in August, and gasoline drove a third of that month's CPI gain. Energy prices feed directly into those inflation readings, which is one reason oil's slide is being watched well beyond the commodities market.

Even while tightening, the Fed has not stopped adding money to the system. It resumed regular purchases of short-term Treasury bills in December 2025 and has continued them in order to keep bank reserves "ample"—a technical operation distinct from rate policy. Those purchases absorb Treasury supply and keep cash flowing to buyers of risk assets, working somewhat against the tightening effect of the rate increase. The result is a rare combination: higher rates alongside a balance sheet that is no longer draining liquidity from the system.

The Fed's bond holdings sit near $6.7 trillion, still well below the $9 trillion peak of 2022, but no longer shrinking.

The Technical Picture

On the chart, Bitcoin's daily setup backs up the rally. Price has cleared the zone between $79,673 and $84,144 and is now testing a trajectory toward roughly $90,000. Bitcoin has also returned to a golden cross, a pattern traders widely recognize as bullish, which forms when the average price of the last 50 days crosses above the average of the last 200 days.

If keep control, Fibonacci extensions—the widely watched resistance and support levels—put the next targets at $90,763 and $95,074. A failure to hold the $79,673 zone on a pullback would open the door back to $75,436 and then $73,617, the last defended support zones from the summer.

Prediction-market sentiment is moving in the same direction. On Myriad, a prediction market developed by Decrypt's parent company Dastan, traders are pricing in 48% odds that Bitcoin hits $90,000 this month, against 25% odds that it heads to $92,500.

Altcoins Join the Move

Altcoins are catching a bid as well. XRP climbed to $1.57, Solana gained 18.2% over the week, and privacy-focused Zcash extended its multi-month run to $1,551, up 36.7% over seven days. Of the top 100 coins, 97 posted positive performance over the last seven days.

The Road to the Next Fed Meeting

The Fed's next policy meeting lands on October 27-28, when markets will learn whether September's hike was a one-off response to an oil shock or the first of several planned this year. The central bank's median 2026 projection puts the federal funds rate at 4.1% by year-end. Between now and then, Iran diplomacy, crude prices, and each new inflation print are the macro threads traders will be watching alongside the charts.

Disclaimer: The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.

Source: Decrypt