Key Takeaways
- US announces first interest rate drop since 2020, with a 0.5% cut. We break down key insights off the back of this.
- Bitcoin breaks above $60,000 USD this morning.
- Crypto’s total market cap regains a $2 trillion USD valuation this week.
The market has responded with an increase this morning after the long-awaited decision on interest rates in the US. More on that below.
Bitcoin is currently trading at $62,000 USD, surpassing the monthly open of $58,960 USD for September. The crypto space’s total market cap has also regained a valuation of $2 trillion USD this week. Before the previous March correction, this figure stood at approximately $2.7 trillion USD.
First rate drop in the US since 2020
The US interest rate range now stands at 4.75%-5.0%, a sharper decrease than the 0.25% forecasted.
Below are some takeaways from the Federal Reserve’s statement released early this morning and the latest Summary of US economic projections.
- The Committee has gained greater confidence that inflation is moving sustainably toward 2%.
- The committee’s expectations show further rate cuts in 2024, with most votes between 4.25% and 4.75%.
- Unemployment is projected to rise in 2024 from 4.3% to 4.2%-4.5%.
- GDP expectations have shifted from 2.2%-2.3% to 2.0%-2.1% for 2024.
Fear and greed currently reads 43.
Bitcoin Analysis
Prices are currently trading near previous highs in August heading into the weekend. After breaking and reclaiming this currently smaller range on both sides, below are two price action-based scenarios that may play out from here.
Bullish Scenario
If the push higher continues to gain momentum, we could see a move into previous July highs coming just under $70,000 USD.
Bearish Scenario
Should the bulls ease off the gas in the coming days, the current range may offer an area for another move to the downside.
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