The anxious wait continues in the cryptocurrency market led by Bitcoin, and many opinions are emerging during this period. An analyst stated that only one main indicator is necessary to predict whether Bitcoin can surpass its all-time high of $73,700 by the end of this year, and everything rests on the shoulders of the US Federal Reserve.
Macroeconomic Data and Bitcoin
Timothy Peterson, the founder and investment manager of Cane Island Alternative Advisors, made the following statement:
“The high yield rate in the US is a great indicator, and it really needs to fall below 6 or 7% for a sustainable all-time high.”
The analyst believes that Bitcoin’s price movement is tied to interest rate movements. According to YCharts data, the US high yield rate, which represents the rate of high-yield corporate bonds due to high default risk, was 7.54% at the time of publication. Peterson predicted that if yield rates fall to the 6 or 7% range, Bitcoin could see the eagerly awaited $100,000 price tag by the fourth quarter of 2024 or the second quarter of 2025.
Typically, the Federal Reserve lowering interest rates leads to high yield rates; according to a recent Reuters poll, nearly two-thirds of the economists surveyed predict this will happen in September of this year.
Interest rates are perceived as an important indicator for crypto investors because lowering rates generally provides less return for investors in safe-haven securities like bonds and term deposits. As a result, more investors turn to riskier assets like Bitcoin to achieve better investment returns.
Famous Analyst Comments on the US
Peterson argued that the general markets are usually stable and variable between September and October. The famous analyst commented many times, though not always, but with the upcoming US elections at the end of this year, currently planned for November 4, he claimed that uncertainty would be higher until October before election day.
Meanwhile, crypto analyst Scott Melker, also known as The Wolf of All Streets, explained that the Fed lowering interest rates is not always suitable for assets outside of fixed-income investments. In a post related to X on May 14, he made the following statement:
“There is an extremely popular theory that the Fed’s pivot is good for the markets.”
He commented that interest rate cuts generally precede major declines in the market.
