Bitcoin (BTC) went on to hit the $61,000 price level after a brief dip as all investor’s eyes are still locked on the US Federal Open Market Committee (FOMC) meeting. The global crypto market printed majorly green indexes depicting traders’ confidence over much anticipated rate cuts.
The cumulative crypto market cap jumped by more than 2% over the last day to stand at $2.08 trillion. Its 24-hour trading volume spiked by 26% to stand at $77.28 billion. However, the fear and greed index still hangs under the ‘Fear’ territory.
Bitcoin holds $60K
Bitcoin price breached $61K on Tuesday night before retracting to the $60K zone. BTC is now up by around 7% in the last 7 days, while, it remains down by 10% over the past 60 days. The biggest crypto is trading at an average price of $60,479, at press time. Its 24-hour trading volume spiked by 39% to stand at $39 billion.
BTC received a bullish push from the positive inflow recorded from exchange-traded funds (ETFs). Data provided by Sosovalue shows that on September 17, the total net inflow of BTC ETFs stood at $187 million. These ETFs have a positive net inflow that has continued for four consecutive days.
Fidelity’s FBTC led with a $56.6 million inflow and marked its 7th consecutive day of gains with $279.7 million total. Bitwise’s BITB and ARK Invest & 21Shares’ ARKB followed with $45.4 million and $42.2 million inflows, respectively. VanEck’s HODL, Invesco’s BTCO, and Franklin Templeton’s EZBC saw $20.5 million, $10.2 million, and $8.7 million, respectively.
Fed rate cut speculation
The crypto market has turned green as the Fed is set to announce its first rate cut since the COVID-19 pandemic. This move could shake up borrowing costs across the economy. While most are predicting a 0.25% cut from the current 5.3%, some Wall Street traders are betting on a more dramatic 0.5% cut.
Meanwhile, traders on Polymarket are divided as they are giving a 53% chance to 50 bps and 46% to 25 bps cuts. A larger-than-expected cut could have a major impact on BTC and other major tokens. US unemployment is rising, it stands at now 4.2% after climbing in four of the last five months. Historically, this trend tends to happen right before a recession. Fed’s decision helped ease the pressure.
Investors brace for higher swings in asset classes following the Fed’s rate decision. Stock options are pricing a 1.1% swing for the S&P 500 today. Along with this, the S&P 500 has rallied 4.2% over seven sessions, nearing record highs. A smaller rate cut might disappoint, given the recent gains.
Traders expect around 120 bps worth of cuts by year-end, and any deviation from this, or a less aggressive Fed stance, could prompt a market recalibration.
