Bitcoin (BTC) broke above $62,000 on Wall Street on August 23 after the U.S. Federal Reserve announced it would cut interest rates for the first time since 2019.
BTC Price Volatility Increases as Fed Chair Powell Says Policy Should Be ‘Adjusted’
A new local BTC price was recorded at $62,323 on Bitstamp, according to data from Cointelegraph Markets Pro and TradingView.
Investors reacted warmly to Federal Reserve Chairman Jerome Powell’s confirmation that interest rates would now begin to fall.
“It’s time to adjust policy,” he said in a speech at the Jackson Hole annual symposium.
In an episode in which markets were watching closely for signs of policy easing, the dovish Powell signaled an appropriate easing of policy restraint, but did not give a specific timetable for when the cuts would begin.
He added that “the current level of policy rates provides ample room to respond to all possible risks, including the undesirable risk of further weakening of labor market conditions.”
Hiring has been a major topic of discussion this week after a sharp workforce cut that saw job openings fall by 818,000 in the 12 months to March 2024.
According to the latest data from CME Group’s FedWatch tool, the market is betting that the Fed will cut rates by 0.25% at its next meeting in late September.
Bitcoin market commentators were bullish on this.
Scott Melker, a trader, analyst and podcaster known as the “Wolf of All Street,” summarized Powell’s quote in a post on X: “Powell has gone full dovish.”
Arthur Hayes, former CEO of cryptocurrency exchange BitMEX, predicted that “there will come a time when crypto will be the only one.”
Popular trader CrypNuevo analyzed short-term market movements, writing that “$BTC liquidations are being hit to the upside and a long wick is forming.”
Bitcoin Traders Expand Liquidity Game
The latest data from monitoring resource CoinGlass tracks liquidity changes across exchange order books. This shows that a new block of sell liquidity has been added at $62,450, preventing the price from rising further at the time of writing.
Related: Bitcoin Macro Peak Expected in 2025 Despite ‘Chaotic’ March Highs
Nonetheless, $62,000 remains a key breakout level for bulls to turn to support on the daily timeframe.
“Bitcoin is still facing a major breakout. If it breaks $62,000, it will be a signal that the market is set to continue its uptrend this week,” Michael van de Poppe, founder and CEO of trading firm MNTrading, confirmed in a recent X Analysis.
Van de Poppe added that the inflows into U.S. spot Bitcoin exchange-traded funds (ETFs) last week meant this scenario was “highly likely.”
“Given the massive inflows we saw in ETFs last week, such a breakthrough seems likely,” he wrote.
Net ETF inflows for the first four days of this week were just over $250 million, according to data from sources including UK investment firm Farside Investors.
This article does not contain any investment advice or recommendations. All investment and trading moves involve risk, and readers should conduct their own research when making decisions.