Bitcoin Eyes $66,000 Amid Speculations of Interest Rate Cuts
As Bitcoin stabilizes above the $60,000 mark, bullish sentiment grows with speculations that the Federal Open Market Committee (FOMC) might cut interest rates in its upcoming meeting. Bitcoin is currently trading at $60,236, with minor movements after gaining 3.61% the previous day.
The possibility of a 500 basis points interest rate cut has led analysts to question whether Bitcoin’s inverted head and shoulders pattern will push the price to $66,590. The market is now focused on the recovery trend, especially with Bitcoin’s performance in the 4-hour chart, which shows a clear inverted head and shoulders pattern. This recovery momentum is strengthening the broader market sentiment, hinting at further gains for Bitcoin.
The bullish surge has led to a bullish engulfing candlestick on the daily chart, negating a three-day bearish correction that took place over the weekend and into Monday. This recovery in the 4-hour chart, combined with the bullish engulfing candle on the daily chart, completes the right shoulder of the inverted head and shoulders pattern. The chances of an upward move increase, especially after a successful retest of the minor pullback following the breakout, potentially driving Bitcoin even higher.
According to Fibonacci retracement levels on the daily chart, the next major resistance stands at $61,613, coinciding with the 23.60% Fibonacci level. This aligns with the projected target of $66,600, should Bitcoin continue its bullish trajectory.
Bitcoin ETFs on the Rise
Adding fuel to the bullish fire, Bitcoin Exchange Traded Funds (ETFs) have seen an uptick in inflows. The U.S. Bitcoin ETF market recorded its fourth consecutive day of gains yesterday, with inflows totaling $186 million. This surge in ETF inflows is being led by Grayscale’s Spot Bitcoin ETF, which continues to accumulate Bitcoin without experiencing any significant outflows. Bitwise and Fidelity ETFs are also contributing to the momentum, with inflows of $45.4 million and $56.6 million, respectively.
This institutional demand for Bitcoin is seen as a major driver of the current price surge, as ETFs make it easier for large investors to gain exposure to Bitcoin without having to deal directly with the complexities of holding and securing the cryptocurrency.
Key Price Targets for Bitcoin
Based on the price action in the 4-hour chart, the next significant resistance levels for Bitcoin are at $64,596 and $66,590, following the key threshold of $61,451. On the downside, the primary support lies at the psychological level of $60,000, with further support at the horizontal level of $57,681.
The 4-hour chart’s Moving Average Convergence Divergence (MACD) indicator also signals further upside, as it recently gave a bullish crossover with rising positive histograms. This momentum indicator suggests that the bullish trend might persist in the short term, supporting the case for Bitcoin breaking through the $61,000 barrier.
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In conclusion, Bitcoin’s near-term outlook remains optimistic as long as the $60,000 support holds, with key resistance levels at $64,000 and $66,000. Institutional interest, particularly through ETFs, coupled with the potential for interest rate cuts, is creating a favorable environment for continued upward momentum. Traders and investors will be closely watching the Federal Reserve’s next move and its impact on Bitcoin’s price trajectory.
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