Key Insights
- •The price of Bitcoin recorded marginal declines after hitting a two-week high.
- •Analysts remain bullish on BTC USD, highlighting a key support level for the asset.
- •The expectation of a 25 bps Fed rate cut further fuels bullish sentiment in the market.
The price of Bitcoin is once again on investors’ radar today, especially as it neared the $116,000 mark recently. However, the momentum was short-lived, and soon after the surge, Bitcoin USD witnessed a slight pullback, hovering near the $114.5k level.
It seems that the current retesting of the crypto has failed to impact the optimistic sentiment of market pundits. For context, experts have cited the current retreat as a healthy pullback, especially after the volatile trading recorded in the broader crypto market recently.
In addition, some have also said that BTC might continue to witness a volatile session ahead of the FOMC interest rate cut decision tomorrow. Simultaneously, market watchers are betting on a potential 25 bps Fed rate cut by the US central bank at their upcoming gathering.
The lower rates could significantly boost the broader crypto market sentiment, while pushing the price of Bitcoin higher. Having said that, on-chain analysts have highlighted key support and resistance levels for BTC USD that the crypto must hold to continue its upward trajectory ahead.
Price of Bitcoin Slips Ahead of Fed Rate Cut
The BTC price has recorded a marginal decline today, slipping around 0.3% to $114,544, and its trading volume fell 13% to $51 billion. Over the last 24 hours, the price of Bitcoin has touched a high of $115,779, recovering from a low of $113,566.
As Bitcoin USD maintained its momentum above the $114k level, it appears to have bolstered the confidence of market experts. Besides, many have cited the upcoming FOMC interest rate cut event as a potential reason behind the volatile scenario.
Simultaneously, it has also led to many bullish Bitcoin price predictions, potentially to $120k.
Meanwhile, the US central bank is expected to announce a 25 bps Fed rate cut at its upcoming meeting tomorrow. This marks one of the most important events for the global financial markets, let alone the crypto space.
According to the CME FedWatch Tool, the odds of a 25-bps Fed rate cut are now at 98%. In addition, the market is also anticipating another rate cut at the year-end gathering of the Federal Reserve in December.
Here’s Why the Price of Bitcoin May Rally Ahead
Market experts have cited a flurry of factors that may boost BTC’s appeal to traders in the near future. The price of Bitcoin has already recorded a massive surge in recent months, touching a new all-time high in early October.
Now, the expected Fed rate cut on October 29 may further help in a strong recovery of Bitcoin USD as well as the broader crypto market. Risk-bet assets like digital assets tend to perform well in times of lower policy rates, as it boosts liquidity expectations.
On the other hand, institutional interest in the flagship crypto also appears to be returning. According to Farside Investors’ data, the US Spot Bitcoin ETF has recorded an inflow for the third straight day through October 27.
This comes after the investment instrument has recorded a massive outflow in recent weeks. On October 27, the total inflow was recorded at $149.3 million, with no major outflows.
Having said that, this soaring interest from institutions might also help push the price of Bitcoin higher.
Analysts Reveal What’s Next for Bitcoin USD
The recent surge of Bitcoin USD to the $116k level has lifted experts’ sentiment. On-chain analytics platform Santiment has deemed it a “bullish Monday,” highlighting both ETH and BTC’s surge to 2-week highs.
Besides, analyst Ali Martinez noted that $114,450 marks a key support level for the price of Bitcoin. As long as it holds, the crypto could continue its upward run, potentially challenging the next major resistance at $117k.
Echoing a similar sentiment, Michael van de Poppe also lauded the development. Besides, he said that the recent retreat in Bitcoin USD is “normal, pre-FOMC.”
He also said that the crypto might continue its upward trajectory after the Fed rate cut announcement.
Having said that, it seems that holding the $114k support is crucial for BTC to maintain its positive momentum. However, as analyst Ted suggests, if the crypto loses the support at $113,500, a looming crash to $110k awaits.
So, investors must consider the macroeconomic and geopolitical factors while putting their bets into the asset. Although the current trends seem bullish, any major development can trigger another volatile session in the broader financial sector, let alone the price of Bitcoin.