According to Odaily, Bitcoin has dropped below the $60,000 mark as the market anticipates a rate cut by the Federal Reserve later this week. The impending policy adjustment by the Fed has created a sense of unease across global markets. This would be the first rate cut by the U.S. in over four years, signaling a more accommodative financial environment, which is generally seen as favorable for higher-risk assets like cryptocurrencies. However, investors remain uncertain about the extent of the rate cut expected on Wednesday and how the market will react to the latest projections from Fed officials, known as the dot plot, and the briefing by Fed Chair Jerome Powell.
Sean McNulty, Head of Trading at liquidity provider Arbelos Markets, stated, 'The rate cut itself is less significant than the signals and the latest dot plot presented at the press conference. If the guidance and the press conference are notably dovish, we expect Bitcoin to rise.' Bitcoin's price surged by 10% over the seven days ending last Sunday, marking its largest weekly gain since July, possibly reflecting increased bets on a 50 basis point rate cut by the Fed.
Caroline Mauron, Co-Founder of digital asset derivatives trading liquidity provider Orbit Markets, noted that in the Bitcoin options market, traders are placing significantly more weight on the Fed meeting than we have seen recently. It can be said that the outlook for monetary policy has become the primary driver of Bitcoin's short-term movements, overshadowing, at least for now, the impact of the U.S. presidential election.
