Bitcoin is holding $60K — Here’s why it’s important

Bitcoin (BTC) gained 4% between Aug. 21 and Aug. 22, and despite losing some momentum, it has sustained the $60,000 support. Some analysts argue that a break above the $62,000 resistance is necessary to confirm a bullish trend. However, given the market’s confidence in the United States Federal Reserve (Fed) implementing expansionary measures, the odds still favor Bitcoin bulls.

Bitcoin’s fundamentals and spot ETF flows remain solid

Bitcoin analyst and investor Decode believes that BTC's price must break above the 200-day moving average, especially at the monthly close, to “resume the bull trend.” 

Source: decodejar

However, Decode adds that Bitcoin “seems to have lost momentum for now, [...] so, August - September looks most likely a continuation of the boring zone, but I am bullish on Q4 and ready to be surprised.” 

In essence, investors remain bullish for the medium term but do not foresee an immediate catalyst to close the gap between Bitcoin and traditional markets.

Investors anticipate that the Federal Open Market Committee (FOMC) will cut interest rates at the next meeting scheduled to conclude on Sept. 18. Some economists believe there is potential for a 0.50% rate cut, which would be considered aggressive and typically favorable for risk-on markets. 

Such a cut would lower the compensation for fixed-income investments like US Treasuries and reduce the cost of capital for companies. Even a 0.25% rate cut would signal to the market that the most severe phase of monetary tightening is behind us.

Bitcoin (blue) vs. gold (orange) vs. S&P futures (red). Source: TradingView

Some traders might note that the S&P 500 is trading just 1% below its all-time high, and even gold, often considered the world’s most reliable store of value, reached its highest-ever mark on Aug. 20. In contrast, Bitcoin remains 16% below its June 2024 historical high of $71,943. are certainly concerned about the US government’s fiscal debt and are seeking protection in scarce assets, most are not yet ready to fully