Bitcoin awaits Powell’s Jackson Hole speech

#MarketSentimentToday #bitcoin #btcupdates2024 #CryptoNewss

#MarketForecast

BTCUSD

Bitcoin (BTC) moved sideways on Thursday after reaching $61,000 on Wednesday following the release of the Federal Open Market Committee (FOMC) minutes.


Possible effects for traders

According to the FOMC minutes, the Federal Reserve (Fed) will likely ease monetary policy at its next meeting, contingent on upcoming data meeting expectations. The minutes also revealed that some policymakers favoured a 25-basis-point rate cut at the July meeting. However, the Fed ultimately decided to keep rates unchanged. As a result, the U.S. Dollar Index (DXY) hit new lows for 2024. Fluctuations in the DXY can influence BTC, as a weakening U.S. dollar (USD) often leads investors to turn to alternative assets like Bitcoin, driving its value higher.On the other hand, global liquidity (M2) is on an upward trend. M2 represents the total money supply within the global economy, encompassing checking accounts, savings accounts, and other liquid assets that can be easily converted to cash. Typically, risk assets like Bitcoin tend to correlate positively with increasing liquidity. The connection between Bitcoin's price and M2 rise signals broader market sentiment and economic conditions. It indicates a loose monetary policy and a growing money supply, often supporting risk assets such as cryptocurrencies. As Cryptonary noted, ‘BTC is the most sensitive asset to liquidity. Historically, a 10% increase in global liquidity has corresponded to a 40% increase in Bitcoin's price’.BTCUSD rose during the Asian and early European trading sessions. Today, all eyes will be on Fed Chair Jerome Powell's speech at the Jackson Hole symposium due at 2:00 p.m. UTC. Powell's comments may cause market volatility, particularly in risk-sensitive assets like Bitcoin. Unlike traditional trading instruments such as stocks and currencies, Bitcoin will continue to react to Friday's news events over the weekend.