Asia Open: Digital Assets Hold Firm Ahead of Key Fed Meeting and High-Stakes Trump–Xi Talks

Traders are gearing up for a decisive week as optimism grows around a potential Trump–Xi tariff deal and a dovish signal from the Federal Reserve, though uncertainty from rare-earth tensions and the ongoing U.S. government shutdown continues to weigh on sentiment.

Bitcoin hovered near $114,000 and Ethereum traded around $4,120 early Tuesday in Hong Kong as global markets braced for a convergence of major catalysts — U.S.–China diplomacy, a possible Fed policy shift, and a flood of Big Tech earnings.

Prediction market Polymarket traders are overwhelmingly betting on progress, pricing a 92% probability that Washington and Beijing will finalize a tariff agreement by November 10, following constructive talks in Malaysia. The framework, expected to be confirmed when Donald Trump meets Xi Jinping at Thursday’s APEC summit in Seoul, has bolstered risk appetite across equities and crypto.

Bitcoin briefly hit $116,200 on Sunday before easing back, while crypto and AI-linked equities such as Hut 8, CleanSpark, and IREN gained between 2% and 3%.

Still, not all signals suggest lasting détente. A separate Polymarket contract puts the odds of China lifting its rare-earth export ban by year-end at only 36%, implying traders foresee tactical trade cooperation but persistent strategic rivalry.

That contrast underscores the belief that any breakthrough will likely deliver short-term political gains rather than a structural reset in relations.

According to Singapore-based QCP Capital, the outcome of the Trump–Xi talks “may shape crypto’s trajectory more immediately than the Fed’s policy decision.” The firm highlighted growing speculation that the Fed could soon end its three-year quantitative tightening program, potentially restoring liquidity and supporting risk assets.

“Any hint that such a move is approaching would re-anchor liquidity expectations,” QCP said.

Despite the optimism, Bitcoin remains flat for October, threatening to break its seven-year “Uptober” streak of monthly gains.

QCP also noted that the 26-day U.S. government shutdown has disrupted data releases, complicating the Fed’s outlook. Meanwhile, investors await earnings from Microsoft, Apple, Amazon, Meta, and Google for clues on consumer and corporate resilience.

Derivatives data show BTC and ETH risk reversals have turned neutral after weeks of defensive bias, signaling reduced downside concern.

Even so, QCP cautioned that a sustained rally would likely require Bitcoin to reclaim $116,000 into month-end. With geopolitics, policy, and liquidity all in play, crypto markets face a volatile stretch that could either extend or end “Uptober’s” winning run.

Market Recap

• Bitcoin (BTC): Briefly touched $116,200 before consolidating near $114,000, holding firm ahead of the Trump–Xi summit and Fed decision.
• Ethereum (ETH): Steady around $4,120, mirroring Bitcoin’s consolidation amid macro uncertainty.
• Gold: Rebounded to $4,021 per ounce after dropping below $4,000 on Monday as optimism over trade talks and rising yields curbed haven demand.
• Nikkei 225: Japan’s Nikkei 225 fell 0.38%, while Topix slipped 0.49%, as traders awaited Trump’s first meeting with Japan’s new Prime Minister Sanae Takaichi.