Bitcoin’s recent price surge, climbing 4.5% in the last 24 hours to surpass $60,500, has captured the crypto world’s attention. This significant rebound comes just one day before the Federal Open Market Committee (FOMC) meeting on September 18, sparking speculation about how the Fed’s decision on interest rates might influence Bitcoin’s trajectory.
BTC’s Technical Chart – The Path to a Bullish Breakout
Bitcoin has been trading within a down-trending channel, presenting a critical juncture for the cryptocurrency’s future. To ignite a sustained bull run, BTC needs to decisively break above the upper boundary of this channel on a weekly chart. According to popular crypto strategist Rekt Capital, the key level to watch is $61,900. Surpassing this threshold could signal a shift from Bitcoin’s current range-bound movement to a more bullish trajectory.
Historically, Bitcoin tends to experience a breakout approximately 150-160 days following the halving event, a pattern observed in previous cycles. With the Bitcoin halving taking place in April 2024, many anticipate that BTC might start breaking out from its reaccumulation phase by late September. Notably, September has traditionally been a tough month for Bitcoin, averaging a 4.48% decline. In contrast, October has often been a month of recovery, with average gains of 22.9%. This historical context suggests that the current consolidation phase might be coming to an end, potentially setting the stage for a significant upswing in October.
Fed Rate Cut – The Market’s Anticipation
The upcoming FOMC meeting is pivotal, with the market divided on whether the Federal Reserve will opt for a 25 basis points (bps) or a more aggressive 50 bps rate cut. Banking giants JPMorgan and Goldman Sachs are leaning towards a modest 25 bps cut, a move that could inject more liquidity into the markets and potentially fuel a Bitcoin rally. The consensus among many market participants is that a rate cut could act as a catalyst for Bitcoin’s price, offering a boost as investors seek assets that might benefit from increased liquidity.
However, the situation is not without controversy. Renowned economist Peter Schiff has expressed skepticism, arguing that rate cuts could exacerbate inflation and negatively impact Bitcoin. Meanwhile, Massachusetts Senator Elizabeth Warren has pushed for a more substantial 75 bps rate cut, though it remains uncertain whether her demands will influence the Fed’s decision.
As Bitcoin approaches this critical juncture, all eyes will be on the Fed’s decision and its potential impact on the cryptocurrency market. Will the anticipated rate cut be the trigger for a new bull run, or will it add to the volatility? The coming days will be crucial in determining Bitcoin’s path forward.
Stay tuned as we continue to monitor Bitcoin’s performance and the broader economic implications of the Fed’s decisions.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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