Against the popular expectation that the proposed US Fed interest rate cut would push the Bitcoin price today up, cryptocurrency analysts have predicted a sharp fall in the BTC price post the said rate cut. Can that be the truth?
Fed Rate Cut & Bitfinex Analysts’ Prediction
Recently, Fed Chair Jerome Powell hinted that an interest rate cut would be announced in September.
Generally, a rate cut is considered as an optimistic development by the crypto community. In a normal situation, such a rate cut leads to an increase in fund flow to the crypto market, as investors start to get tempted to choose risky assets like cryptos or safe assets like bonds in anticipation of higher returns.
As per Bitfinex analysts, this time the market would behave differently.
They have forecasted the possibility for a fall of at least 15% to 20%.
If the market behaves as per the prediction, the Bitcoin price would drop to a level ranging between $40,000 and $50,000.
About The Volatile Month of September
For those who are closely watching the historical price momentum of Bitcoin, the prediction may not feel like a surprising one. Historically, the month of September has been a tough month for Bitcoin.
Analysts have also highlighted this unique price momentum history of the month as one of the prime reasons to justify their forecast.
Bitcoin Market Overview
At present, the Bitcoin price remains at $56,497 – the lowest point the market has reached so far this month. This month, the market opened at the level of $58,956. The strong selling pressure emerged on the first day of the month, dragging down the price to a low of $57,324. Next day, defeating sellers, buyers took control of the market pushing the price up to $59,143. But, in the following days, the market saw the dominance of sellers.
Yesterday, as a result of a long red candlestick, the price dropped to $57,484. Today, the price is sharply moving downwards, indicating an increasing strength of sellers, as the market has seen the month’s highest 24-hour trading volume of $119.019M.
What Could Happen Next in the Bitcoin Market?
Markus Thielen, the head of research at 10xResearch, has expressed his hope for the emergence of a new bull run in the Bitcoin market. But, he has also predicted the possibility for the price of BTC to fall as low as $40,000 before the expected bullish momentum.
There are some analysts who believe that the Bitcoin market is currently in a consolidation phase, where long-term investors silently accumulate the asset, exploiting fear and confusion among short-term buyers.
A few others think that at present the BTC price is hovering around its Bull Market Support Band, which generally happens when there is indecision in the market.
As a final thought, we can say that Bitcoin traders are going through a very tough time. The latest prediction related by the Bitfinex analysts is a big blow to those who were expecting that the price would go up post the Fed rate cut implementation. Anyway, September is going to be a crucial month for the Bitcoin market.
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