Bitcoin Price Today Steadies Near $64K: Rebound Slows as Rate Cuts Loom
South African men arrested over Bitcoin ‘Ponzi scheme’.; Image copyright Getty Images Image caption. The price of the cryptocurrency has been volatile. However, the currency was trading near its highest in close to a month on optimism that interest rate cuts will be necessary to fend off recession.
Bitcoin was far from alone in its drop; cryptocurrencies that had been marching higher since Friday were succumbing to a broad retreat. HCA Healthcare (NYSE: HCA) led the gains, spurred by remarks from Federal Reserve Chair Jerome Powell suggesting that the central bank is gutting for rate cuts.
A sliding US dollar which tumbled to a 13-month nadir also helped bolster prices of cryptocurrencies. This morning Bitcoin dropped another 0.3% falling as low as $63,952.7 earlier in the day it was over above a new ATH by several dollars at around$64,454 according to Bit stamp exchange data on front-month.
Futures contracts fell from Friday’s closing notional price of #65,465 after hitting a record high near two weeks back just under $68K before tumbling and never getting close again across Sunday/Monday.
European trading hours due imbalance control volume spikes where capacity is far too constrained last week, they reversed their stances decisively once traders saw clearer declines warrant reducing small fund adjustments slowing down buys repurchasing tweaks smaller rebalance mainly vespers unless facing symphony type overflow levels similar market stabilization being signaled skid retail selling.
Company didn’t respond. Questions? The Japanese yen kept the pair constrained, though its additional gains were capped. The yen had previously seen a steep spike as carry trades unwound, driving down riskier assets like Bitcoin.
The Reason Behind Bitcoin Pump Interest Rate Cut Speculation
Much of Bitcoin’s violent surge over the past two days was driven by Powell indicating that there may be an interest rate cut coming. This expectation in turn has caused markets to price-in a likely rate cut September. Still, there is at least uncertainty about the materiality of the cut (25 bp or 50), if not its direction.
The result could also hinge on Friday’s release of the Personal Consumption Expenditures (PCE) price index, a measure of inflation preferred by the Federal Reserve. PCE data will be a key determinant of whether and when the Fed lowers rates.
In general, speculation is conducive to the rapid rise of assets such as Cryptocurrency, which will increase liquidity in the market and make it easier for investors to allocate funds into this area. Bitcoin and cryptocurrencies have done particularly well in such an environment due to their dependence on higher market liquidity.
State of Politics and Crypto Regulation
Political developments also have the potential to influence future price action of Bitcoin and other cryptocurrencies, besides market factors. Long-shot independent presidential candidate Robert F. Kennedy Jr., a strong cryptocurrency ally, has now dropped out of the race and thrown his support behind Republican nominee Donald Trump instead.
In the United States, where a pro-crypto Trump has danced around regulators in their efforts to stifle Libra and other digital assets. Kennedy’s support for Trump marks a change in the tides of politics that could end up being good news for crypto. Any sort of regulatory clarity will result in bull boom and spick up investment within field if crypto friendly administrations come into play.
Conclusion
In sum, Bitcoin prices fell only slightly on Monday as the weekend surge ended its momentum and stopped combo-trades from taking over. But the cryptocurrency remains close to its one month high as expectations of an interest rate cut supports it. Investors are already looking for the next batch of economic releases, particularly that final PCE price index reading ahead of any further rate-cut action from the Federal Reserve.
Luck is on the side of cryptocurrency too thanks to positive political developments that boost confidence around U.S regulation, (such as Robert F. Kennedy Jr.’s endorsement for Donald Trump), potentially providing yet another layer of support riding into and through this election season.
