The situation in the Middle East has eased, with Israel and Lebanon agreeing to a permanent ceasefire agreement. The Federal Reserve's meeting minutes indicate that the U.S. will maintain a gradual rate cut pattern. The main U.S. stock indices closed higher on Tuesday (11/26), with both the Dow and S&P indices reaching all-time highs. Cryptocurrencies, on the other hand, fell across the board, with Bitcoin retreating to $91K and Ethereum pulling back to above $3,300.
The Federal Reserve will maintain a gradual rate cut.
The Federal Reserve's meeting minutes indicate that there is still some way to go before a pause in rate cuts. Federal Reserve officials stated that as the economy remains robust and inflation slowly cools, they generally support taking a cautious approach when it comes to future rate cuts.
According to the minutes from the Federal Open Market Committee meeting that ended on November 7, 'Participants expect that if the data meets expectations and inflation continues to decline to 2%, with the economy remaining close to maximum employment levels, then over time, a gradual shift to a more neutral policy stance may be appropriate.'
The CME FedWatch index shows that 63.2% of traders expect the Federal Reserve to continue cutting rates by 25 basis points at the December meeting, up from 52.3% the previous day.
Standard Chartered: Bitcoin may pull back to $85K, year-end target price $125K.
Bitcoin repeatedly challenged the $100,000 mark last week without success, and this week it has seen a significant pullback. Geoff Kendrick, head of global digital asset research at Standard Chartered Bank, pointed out factors driving the pullback, including changes in the U.S. Treasury market and the upcoming monthly options expiration.
Kendrick stated that since Bitcoin is often seen as a hedge against instability in traditional financial markets, increased confidence in U.S. Treasuries may weaken Bitcoin's appeal in the short term, leading to a price decline.
Another factor affecting Bitcoin prices in the short term is the monthly options for the asset expiring this Friday. Kendrick noted that Deribit's data shows there are 18,000 open contracts for Bitcoin with strike prices between $85,000 and $100,000, which may limit price volatility before expiration.
However, institutional demand for Bitcoin remains strong. Kendrick noted that since the beginning of this month, following the U.S. elections, Bitcoin spot ETFs have accumulated approximately 77,000 Bitcoins, while MicroStrategy has additionally purchased 134,000 Bitcoins.
There are no signs of a slowdown in MicroStrategy's purchases, nor is a sale likely. However, since the election, the average purchase price for ETFs and MicroStrategy is $88,700, which may provide short-term support. Bitcoin may consolidate between $85,000 and $88,700 before resuming its upward trajectory.
He remains optimistic about the long-term prospects of Bitcoin. Kendrick reiterated his year-end price target of $125,000 for Bitcoin, which is expected to further rise to $200,000 by the end of 2025.
This article states that Bitcoin has retreated to $91K, with Standard Chartered saying $85K is support, and the year-end target price remains at $125K. It first appeared in Chain News ABMedia.
