As the price of Bitcoin turns red ahead of the Fed’s announcements, all eyes are on Powell’s forthcoming statements. The anticipated 25 basis point interest rate cut is less significant than what Powell will articulate. According to Jelle, a model predicts Bitcoin could reach $150,000 to $170,000. Here’s what you need to know.
Cryptocurrencies on Fed Day
An interest rate cut is certain, with markets expecting another reduction in December. However, due to the government shutdown, crucial employment figures and other economic reports are unavailable. This situation implies that the Fed might make a partly uninformed decision. The latest inflation report was released, but employment numbers were not included.
Powell’s 9:30 PM statements will confirm if the employment aspect of the dual mandate takes precedence. Some data suggest improvement in employment due to economic recovery. Nevertheless, pre-shutdown ADP figures indicated the worst employment outlook in four and a half years.
Inflation remains relatively calm, experiencing below-expected increases, allowing the Fed to support employment recovery. With most Fed members cautioning against aggressive rate cuts, what Powell says tonight is crucial.
Details in the Fed’s rate decision statement and Powell’s 9:30 PM announcement could lead to significant short-term fluctuations in Bitcoin and altcoin prices. Investors should remember the risks associated with high-leverage trades.
Bitcoin Surpassing $150,000
At least, that’s Jelle’s viewpoint. This year, gold has experienced a historic rally, reaching new heights unseen in decades. The anonymous crypto analyst attributes a potential $150,000 to $170,000 Bitcoin range to the positive correlation between BTC and Gold. The continuous rise of gold without a substantial fall supports this outlook.
Gold and Bitcoin are rising sequentially. Both have shown a gradual upward trend over the years—gold recently accelerated to a peak. Will Bitcoin follow the same path? If the scenario remains unchanged, a $150,000 to $170,000 target is possible.
Ironically, gold’s halt may trigger a rise in cryptocurrencies. The easing global tensions and the U.S.-China accord restrain gold while boosting risk markets, including cryptocurrencies. This detail illustrates why history may not always repeat itself.