September 25th Bitfinex Alpha 123 | Expected BTC Accumulation After Rate Cut
On Bitfinex Alpha
Bitcoin had a spectacular ‘upstream’ when the Fed decided to cut rates, rising more than 22% to reach a ‘new peak’ of $64,200 on September 20th. However, BTC has still ‘stubbornly’ failed to break above its ‘stubborn’ peak of $65,200 on August 25th. A failure to break above would confirm Bitcoin’s downtrend since March, with each new high lower than the previous one. It is also concerning that despite the recent price increase, BTC’s open interest levels have surpassed its own price increase, suggesting that the futures and perpetual markets, rather than the immediate exchange markets, were the primary ‘triggers’ for most of the open interest over the past week.
Meanwhile, some altcoins are surging, with some major tokens up more than 100% from their August and September lows. However, caution is warranted as open interest levels for altcoins are also hitting new highs without a corresponding price increase. Overall altcoin market. The OTHERS index, which measures the performance of altcoins excluding the top 10, continued its downward trend last month.
As the price reached $63,500, we expect BTC to move range-bound in the short term as buying in the Bitcoin spot market slows, as evidenced by the flattening of cumulative spot volume.
However, there is also a counter argument that continued ETF inflows could support the BTC price. Last week, $397.2 million was added to spot Bitcoin ETFs. This suggests further upside potential, especially if traditional financial markets such as the S&P 500 continue to rally. If Bitcoin breaks through key resistance levels since late August, it could reach new highs. However, in the absence of continued spot buying, a sideways or partial correction seems the most likely scenario.
The Fed’s decision to cut rates by 50 basis points across the economy appears to be the first in a series of rate cuts and reflects a shift in the central bank’s priorities from controlling inflation to focusing on the labor market.
Inflation is showing signs of moderating, as shown by August retail sales data, which showed a mere 0.1% increase. As employment stabilizes and increases, household spending is expected to follow suit, but uncertainty remains.
Industrial production rebounded significantly in August, and the housing market also showed a ‘warm-up’ in single-family home construction. However, it is uncertain whether this momentum will continue. The Fed’s actions will be important.
The cryptocurrency landscape continues to grow “at lightning speed” with significant institutional moves and regulatory scrutiny. In a major step toward integrating Bitcoin into traditional finance, the SEC has given BlackRock the go-ahead to list its iShares Bitcoin Trust, and other ETF issuers are lining up to file.
Meanwhile, MicroStrategy has expanded its already sizable Bitcoin holdings by purchasing an additional 7,420 BTC for $458.2 million, bringing its total to 252,220 BTC, or $15.8 billion worth.
As these institutional developments take place, law enforcement efforts to eliminate bad actors are also intensifying. German authorities, including the Central Office for Cybercrime and the Federal Criminal Police Office, have dismantled 47 trading platforms that were known to be used for large-scale money laundering.
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