Will Bitcoin Price Hit New All-Time High Heading Into FOMC?

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As a seasoned analyst with over two decades of experience in the financial markets, I have seen my fair share of bull and bear runs, market volatility, and unexpected events that can turn the tide. The recent surge in Bitcoin price from around $96,000 to surpassing $101,000 within 24 hours is a clear indication of a thriving crypto market and renewed investor optimism.

As a crypto investor, I’ve been holding steady around $96,000 for some time, but Bitcoin has shown a robust recovery, surging by 3.5% over the past 24 hours and breaking through the $101,000 mark. This bullish momentum stemmed from the US CPI inflation data released on Wednesday. With the FOMC meeting coming up next week, market analysts are optimistic that we might witness a fresh Bitcoin all-time high.

Will FOMC Be A Bullish Catalyst for Bitcoin Price?

On Wednesday, the release of the U.S. Consumer Price Index (CPI) inflation report boosted confidence among U.S. stock and global cryptocurrency markets. Since the CPI figures aligned with forecasts, investors are now optimistic that a small 25 basis point reduction in interest rates might be decided at the Federal Open Market Committee (FOMC) meeting scheduled for next week.

It’s predicted with high confidence (96-97%) that interest rates will drop, potentially boosting both the robust U.S. and international economies. Since Bitcoin’s value tends to mirror that of the stock market, its price has spiked swiftly past $100K due to this trend.

As Bitcoin’s price dipped around $96,000, significant buying by large investors, or “whales,” was observed. Crypto analyst Ali Martinez noted that 342 wallets containing over 100 Bitcoins were created as the price dropped from $104,000 to $90,000. This data implies these big investors are taking advantage of lower prices by acquiring more Bitcoin.

Conversely, investments into exchange-traded funds focusing on Bitcoin, particularly those based in the U.S., have been steadily increasing during the last week. Over the past nine trading days, these Bitcoin ETFs have experienced a consistent stream of positive inflows, with BlackRock’s Bitcoin ETF (IBIT) achieving a significant milestone by accumulating more than $35 billion in total investments since its launch.

Financial expert Ali Martinez has daringly predicted that Bitcoin could reach an impressive $275,000. This forecast is derived from the “cup and handle” chart pattern that he believes is forming. Martinez suggests investors should take advantage of price drops by buying at lower prices, but cautions against excessive borrowing or risky investments.

What’s Next for BTC After Recent Breakout?

Bitcoin’s price climbed beyond the $94,500 to $98,000 price band after the release of U.S. inflation figures that matched projections, as suggested by 10x Research.

Analysts have observed that the price of Bitcoin usually increases after a drop just before inflation reports, due to stable data easing worries about significant inflation increases. However, while Bitcoin’s price might continue climbing towards the end of the year, 10x Research predicts minimal market excitement as many investors wrap up their investments following the Federal Open Market Committee meeting.

On the other hand, it’s worth mentioning that altcoins appear to be outperforming Bitcoin. Today, for instance, the altcoin market is experiencing a robust increase, largely driven by a 7% rise in Ethereum‘s price, which currently stands at a significant hurdle of $3,920. Additionally, XRP, BNB, SOL, and DOGE have seen modest upticks of around 4-5%.

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2024-12-12 10:36