As an experienced financial analyst, I have closely monitored the intricate relationship between Bitcoin (BTC) prices and the stance of major central banks, particularly the US Federal Reserve. The latest FOMC decision to keep interest rates unchanged has come as a surprise against the backdrop of other G7 central banks slashing their rates.
In contrast to the widespread belief in the financial community, the US Federal Reserve has chosen not to change its interest rate. This decision, however significant, impacts the cost of Bitcoin (BTC) significantly.
Bitcoin Price and Fed Stance
Following the FOMC meeting’s end, US banking authorities opted to maintain interest rates within the range of 5.25% – 5.50%. Contrary to expectations, they did not follow in the footsteps of other G7 central banks, which reduced their rates by 25 basis points.
Last week, the Bank of Canada made a decisive move and reduced its interest rate by 0.25% based on the confidence that inflation no longer posed a significant threat. This action was mirrored by the European Central Bank (ECB), which similarly lowered its rate by the same percentage. In an attempt to bolster its own fiat currency, the Danish Central Bank followed suit and cut its rate last Thursday.
As a researcher studying the cryptocurrency market, I’ve observed that Bitcoin’s price experienced noticeable fluctuations following each rate announcement. It dipped as low as $66,190 before bouncing back up to reach a peak of $70,100. The Federal Reserve’s decision to maintain its current interest rate policy has led to Bitcoin continuing its bullish recovery, which currently places the coin at a price of $68,785.91 – representing a 3.22% increase in value over the past 24 hours.
As an analyst, I’ve noticed that despite the recent price increase, Bitcoin’s trading volume remains significantly lower than before, decreasing by 16.3% to reach a total of $30,874,721,390. The lowest point in the past 24 hours was at $66,902.46, while the highest peak reached $69,977.89. I anticipate that the upcoming Federal Reserve announcement could provide a boost to Bitcoin’s bullish momentum and potentially enable it to retest the resistance level of $70,000.
Market Momentum is Just Shaping Up
In simpler terms, Bitcoin’s price tends to closely follow broader market movements. The behavior of traditional stocks could potentially influence its development in the immediate future.
As Bitcoin investors grapple with the present market situation, the potential influence of a spot Bitcoin ETF cannot be overlooked in the future. After a 19-day stretch of net inflows, there’s been a change in direction with two consecutive days of outflows. This shift can be attributed to Grayscale Investments withdrawing large amounts of capital.
The outlook for Bitcoin’s growth is generally optimistic, with estimates putting its short-term value at around $100,000.
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2024-06-12 22:42