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Bitcoin experienced a significant price surge, breaking through the $112,000 resistance level as the week closed. This upward momentum is largely attributed to the increasing probability of the U.S. Federal Reserve cutting interest rates, with odds now exceeding 98% for an upcoming announcement.
Key Takeaways
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Bitcoin's price climbed above $112,000, with traders anticipating further gains.
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Stronger-than-expected U.S. inflation data has bolstered confidence in a Fed rate cut.
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Global central banks are increasingly pivoting towards monetary easing.
Bitcoin Eyes New Highs Amidst Fed Speculation
Bitcoin (BTC) demonstrated considerable upside volatility as it challenged the $112,000 mark heading into the weekly close. Traders are optimistic about reaching new local highs, fueled by a recent recovery and positive U.S. inflation data. The weekly close often sees increased market activity, and this instance was no exception.
Market analysts observed the $112,000 level being retested, with a clean break and close above it potentially signaling a bullish continuation towards $123,000. Some indicators suggest Bitcoin is in a short-term uptrend, marked by several consecutive green daily candles. A reclaim of the $112,000-$114,000 zone could propel BTC above $118,000 in the near future.
Further analysis points to the short-term holder cost basis around $113,000 as a critical level. If Bitcoin can surpass this, a move into the $130,000 to $144,000 range is considered plausible by some market watchers.
Fed Rate Cut Odds Boost Risk Assets
The upcoming week is pivotal for cryptocurrency and other risk assets, with the U.S. Federal Reserve's interest rate decision on the horizon. Following cooler-than-expected inflation figures, the market widely anticipates a 0.25% rate cut at the Federal Open Market Committee (FOMC) meeting scheduled for October 29th. Data from CME Group's FedWatch Tool indicates a probability exceeding 98% for this outcome.
This potential move by the Fed is seen as part of a broader global trend. Reports indicate that 82% of the world's central banks have cut rates in the last six months, a pace not seen since 2020 and indicative of widespread global monetary easing.
Sources
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Bitcoin Bulls Get a Lift Toward $113,000 Ahead of Fed Rates Decision, Cointelegraph.
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Bitcoin price starts $112K breakout as Fed rate-cut odds pass 98%, CediRates.
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