Bitcoin Jumps from $80.5K to $86K: Fed Comments Boost Rate-cut Hopes
Also boosting market expectations for an imminent interest rate cut, positively impacting risk assets
Bitcoin showed signs of recovery at the start of the week, following comments from New York Federal Reserve President John Williams, who suggested that interest rates could soon be lowered as labour market weakness becomes a growing concern. The cryptoasset, which had fallen to a low of $80,500 last week, its weakest level since April, has now rebounded to around $86,000.
According to Simon Peters, Crypto Market Analyst and UK Account Management Team Leader at eToro, the recent pullback is not out of character for the digital asset. Peters explains that volatility of this scale is typical for Bitcoin, noting that the cryptoasset has seen multiple 30%+ drawdowns in recent years. The most recent occurred between January and April, when Bitcoin dropped from $109,000 to $74,500 before rallying 70% to reach its current all-time high of $126,300. Although that decline was more gradual, he notes that the latest correction has been sharper in nature.
Despite the heightened volatility, Peters says the long-term market structure remains intact. Bitcoin continues to form higher highs and higher lows, maintaining a long-term uptrend. With the price now sitting roughly 30% below the all-time high, Peters suggests that, if recent historical patterns were to repeat, the market may be nearing the bottom of this correction. He also highlights that on-chain data shows large wallet holders, often referred to as “whales”, already beginning to repurchase, signalling renewed confidence among major investors.
BIGGEST MOVERS
Bitcoin Cash $BCH was up 10% last week following news on Friday that Nasdaq-listed fintech company mF International has raised $500 million for a Bitcoin Cash treasury. Before the announcement on-chain data shows several large wallets were already accumulating in the prior days, which potentially provided support to the BCH price in the midst of a wide downturn in crypto markets.
BCH formed in 2017 as a result of a hard fork from the original bitcoin cryptoasset.
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