What happened?
Bitcoin’s value is currently around $116,200 as the Federal Reserve is expected to cut rates by 25 basis points, bringing the target down to 4.25%. Bitcoin’s future price movement will be significantly influenced by these changes. The digital currency is in a critical zone with potential to rise towards $130,000 or fall back to $114,000 depending on the market’s reaction to the Fed’s decision.
Who does this affect?
These expected changes will have direct impacts on Bitcoin investors and traders. The ongoing price action of Bitcoin has formed a rising wedge, which typically signals fading momentum in uptrends. A positive move for Bitcoin would be clearing the $117,300 mark, opening up $118,500 and $119,350 on the chart. But if Bitcoin breaks below the $115,800-$114,900 zone, losses could extend to $114,400 and $113,200.
Why does this matter?
The Federal Reserve’s decision on whether to cut rates has significant market impact, and thus can heavily influence Bitcoin’s price. If the Fed adopts a dovish stance, it could fuel risk-taking and potentially send Bitcoin’s value soaring to $130,000 by the end of the year. On the other hand, if the Fed proceeds with caution, Bitcoin’s price may consolidate near current levels until buyers regain confidence.