Bitcoin breaks $57K barrier as odds of a federal rate cut rise to 85% The odds of a federal interest rate cut rose by 25 basis points to 85% after the latest US consumer price index data, which showed a slight rise in the core consumer price index to 0.3%.
This news pushed Bitcoin (BTC) above the $57,000 level, indicating strong demand and rising bullish sentiment . The growing interest in bitcoin buying options as October-December expires reflects traders’ optimism for the coming months.
Bitcoin Volatility Drops Ahead of FOMC Meeting
Bitcoin’s liquidity saw a 12-point drop this week, due to the release of the CPI and the US presidential debate. With no major monetary events expected before next week’s FOMC meeting, another decline in price volatility is expected.
Despite this calm, demand is increasing in the market in anticipation of the upcoming US presidential election and a possible rate cut by the Fed. An interesting business idea, the “election ticket,” offers a 180% return if the price of Bitcoin stabilizes between $70,000 and $80,000 on November 8. Even if the target is not met, investors will recover 80% of their capital, limiting potential losses to 20% .
The latest updates provided by analytics platform Santiment highlighted the positive impact of the US CPI report and other economic factors across different asset classes. The S&P 500 and gold are nearing all-time highs, while Bitcoin, currently at $57.2K, still has plenty of room to go to reach its peak of $73.7K .
Bitcoin Weathers Challenges and Gains Despite Weaker Dollar
Since its launch, Bitcoin has proven strong resilience in the face of various economic challenges, cementing its reputation as a reliable digital asset capable of hedging against inflation. Its ability to maintain its value, despite significant volatility in global markets, has helped attract the interest of institutional investors, especially during periods of economic uncertainty. These factors have made Bitcoin play a key role as a potential store of value in the global financial system.
On September 13, 2024, Bitcoin traded at $58,000, after experiencing fluctuations between $54,000 and $65,000 throughout the year. Although short-term price movements are influenced by various factors such as global economic conditions and changes in interest rates, analysts remain optimistic about Bitcoin’s long-term future. Many consider Bitcoin to be an attractive investment opportunity despite market instability.
For the past three weeks, the cryptocurrency has been trading below the $60,000 resistance level, indicating a selling pressure in the cryptocurrency markets. However, the BTC/USD pair has risen 3.8% in the last seven days to $58,329, reflecting an increase in demand for bitcoin, especially with analysts expecting further gains in the near term.
Bitcoin also benefited from a weaker US dollar, as a result of expectations of a rapid easing in interest rate policies by the Federal Reserve. Recent economic data point to a slowdown in the US economy, increasing the likelihood of a rate cut to stimulate economic growth.
At the moment, Bitcoin is priced at $58,093.99, up 4.1% over the past week. This upward trend is expected to continue in the coming weeks, especially as some options contracts approach expiration.
Mixed flows of Bitcoin and Ethereum ETFs
Bitcoin (BTC) and Ethereum (ETH) exchange-traded funds saw mixed results as cryptocurrency markets began to show positive signs this week.
Data provided by SoSoValue shows that bitcoin ETFs are returning to normal, recording strong net inflows of $39.02 million on September 12, 2024. This development comes as the price of Bitcoin has begun to show signs of recovery as it tries to surpass $58,000.
Today’s gainers are led by ARK 21Shares Bitcoin (ARKB) ETF, which made $18.34 million.
This is not enough to compensate for the brutal losses incurred throughout August, but it is a strong influx of a fund that performed very well with cumulative net inflows of $2.25 billion.
Fidelity’s Bitcoin Wise Origin Fund (FBTC) recorded net inflows of $11.47 million, bringing cumulative net inflows to $10 billion. It almost reached this level at the end of July.
However, market problems in August trimmed its wings to $9.99 billion, and cumulative net inflows now stand at $9.54 billion.
Greyscale’s Bitcoin Mini Fund earned a net $5.18 million, as did Bitcoin Van Eyck Exchange Traded Fund (HODL), which generated net inflows of $4.95 million.
Other gainers include the Franklin Templeton Digital Holdings Trust (EZBC), which generated net inflows of $3.31 million, and the Bitcoin Bitwise exchange-traded fund (BITB), which attracted $2.22 million.
As expected, Bitcoin Greyscale (GBTC) suffered another day of outflows, losing $6.51 million from its fund. The price was around $57,344. It hit a low on September 5, when it touched $53,994.12. Since then, the market has seen a steady rally. This move has led to increased interest in Bitcoin’s price forecasts for the coming weeks, as traders anticipate the impact of options expiration.
