Bitcoin experienced a dip below the $60,000 mark today, reaching a low of $58,112, causing a stir in the crypto community. This drop occurred amidst speculation about a potential 50 bps rate cut by the Federal Reserve which had recently boosted prices in stocks, cryptocurrencies, and gold. Additionally, the ongoing political turmoil surrounding the upcoming 2024 US presidential election and recent assassination attempts on Donald Trump are also contributing factors impacting the markets.
The recent attempt on Trump’s life near his Florida golf course has heightened tensions. Such political events involving key figures like Kamala Harris and Donald Trump have the power to sway market sentiment. Notably, Bitcoin’s price surged following a previous assassination attempt on Trump in Pennsylvania on July 13, potentially affecting his competition with President Joe Biden as they are currently neck and neck in the presidential race.
Despite Trump’s safety post the latest assassination attempt, related cryptocurrencies like MAGA, TRUMP, and TREMP suffered a noticeable crash in their values.
Looking ahead, the upcoming Federal Open Market Committee (FOMC) meeting on September 18, where the US Fed will announce its monetary policy, is poised to have a significant impact on stocks and crypto markets. The outcome of Jerome Powell’s address following the meeting will provide valuable insights for traders about the market trajectory in the upcoming quarter.
Speculations around a potential 50 bps rate cut are rife, with the CME FedWatch tool indicating a 61% likelihood for such a cut and a 39% chance of a 25 bps cut following the FOMC meeting. Furthermore, data suggests a total of 125 bps in rate cuts throughout the year, which could potentially trigger a substantial rally in Bitcoin’s price.
Market analysts like Jim Reid from Deutsche Bank emphasize that the scale of the Fed’s initial rate slash will significantly influence the total rate cuts for the year. There are rising tensions as the Fed edges closer to its first cut in this round, further compounded by uncertainties surrounding the potential rate hike by the Bank of Japan expected in October.
In the immediate future, Bitcoin’s price movement is crucially poised as it reached a 24-hour low of $58,112. Traders are closely monitoring the breaking of the triangle resistance line for a potential rally. The shift in price from the 0.618 Fib retracement level to the 0.5 Fib retracement level suggests a sideways movement near the $59,000 mark until the conclusion of the US Fed meeting.