Bitcoin Price Analysis
Bitcoin (BTC) has been trading within a narrow range of $59,900 to $61,000 following the release of the Federal Open Market Committee (FOMC) meeting minutes for July.
Recent Price Movements
Shortly after the FOMC minutes were released at 2:00 p.m. ET on Wednesday, Bitcoin’s price climbed steadily, briefly touching the $62,000 mark. However, it has since pulled back to hover above $61,000.
There has also been a shift in the Bitcoin perpetual futures funding rate, which turned positive, indicating a more optimistic investor sentiment.
Increased Likelihood of Rate Cuts in September
The July FOMC minutes have been interpreted as dovish, suggesting a higher likelihood of a rate cut in September. The summary noted, “the vast majority observed that, if the data continued to come in about as expected, it would likely be appropriate to ease policy at the next meeting.” According to the CME FedWatch tool, there is a 67.5% probability of a 25 basis point cut and a 32.5% chance of a 50 basis point cut at next month’s meeting.
Lower interest rates could make risk assets like stocks and cryptocurrencies more attractive by reducing borrowing costs and encouraging investments.
Insights from Analysts
Peter Chung, a Presto Research analyst, outlined the factors contributing to the recent rebound in the cryptocurrency market. He highlighted the dovish FOMC minutes and revised employment figures from the U.S. Labor Department, which suggested greater economic fragility. “A record downward revision in payroll and the dovish FOMC minutes triggered a rally across risk assets,” Chung noted, adding, “the yield curve steepened, the DXY is now down, and small caps and Bitcoin are up.”
In addition, news that Robert F. Kennedy Jr. plans to withdraw from the presidential race and endorse Donald Trump, both of whom have a pro-crypto stance, may also be contributing to positive sentiment in the market.
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