As the article was prepared, the Bitcoin (BTC) price fell to $62,666 and continues to linger below $63,000. The king of cryptocurrencies, which returned its gains faster than the last $70 rise, is causing devastating results for altcoins. Many cryptocurrencies continue the day with losses exceeding 5%.
Why Should Cryptocurrencies Rise?
Interest rates, which have been increased since 2022, have been at their peak for a year, and it is now certain that the first cut will be made as of September. Fed Chairman Powell was much more moderate at yesterday’s meeting and even said they did not want further declines on the employment front and could act faster if there was a weakening. However, Bitcoin does not care about this.
“We have indicated that we do not expect it to be appropriate to lower the target range for the federal funds rate until we gain more confidence that inflation is moving sustainably towards 2%. Second-quarter inflation data increased our confidence, and better data will further strengthen this confidence. We will continue to make our decisions from meeting to meeting.”
Inflation, which has now fallen to 3%, had exceeded 9%, the peak of 40 years. According to FedWatch, a 25bp rate cut in September is 100%. While the stock markets are rising in light of this development, BTC is targeting $60,000 again.
Bitcoin Commentary
Crypto Chase recently evaluated the current situation and said, “The madness continues. Historically, if liquidity sweeps are front-run forever, they fail.” According to the analyst, it may not be surprising if the decline deepens further.
“I don’t have a strong read here, but I think anywhere from the mid-61s to 59 is possible. Bids just depend on how aggressive/safe you are.”
CrypNuevo, on the other hand, said he expects a short squeeze with a quick turnaround, but for now, the chart does not look like anything like that will happen. QCP Capital argues that we could see a recovery with the weakening of sales in the ETH ETF channel.
In August, we will see some statements from the Democratic candidate Harris trying to improve his image on crypto. Indeed, the signals from the party are in this direction. Rates will fall at the next meeting, and the ETHE sales triggering net outflows in the ETH ETF channel should end soon. But for now, none of this matters to Bitcoin.
