Traders expect a Bitcoin rally by the end of 2024. China and the Federal Reserve lead the rally.
Bitcoin traders are gearing up for a critical crypto calendar month.
October ushers in a traditionally bullish period for cryptocurrencies. According to CoinMarketCap analysts, Bitcoin has rallied 90% in the fourth quarter of the year over the past decade.
“Expect fireworks,” said David Brickell, head of international distribution at FRNT Financial, and former forex trader Chris Mill.Connecting the dots” newsletter. “We predict that we will see record highs for Bitcoin this coming week.”
They are not the only bullish. On Deribit, options pay if Bitcoin breaches $100,000 highly traded Dec. 27 Expires – indicates that traders are expecting a new all-time high in the coming months.
China and the Federal Reserve are the biggest near-term drivers behind Bitcoin's rally.
China
Last week, Beijing launched a series of initiatives to stimulate the Chinese economy, which will “unleash a tsunami of liquidity,” Brickell and Mill wrote.
These initiatives include a scheme to issue $284 billion worth of bonds and the central bank's plan to reduce the amount of cash held by banks by 0.5%.
Bitcoin price rose 5% to $66,300 on the news – its highest level since July. The cryptocurrency fell to around $63,000.
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“This is just the beginning; When will the real bazooka arrive? [President Xi Jinping] It directs banks to issue more credit,” Bitmex co-founder Arthur Hayes recently said Blog post.
Federal Reserve
Jerome Powell will speak at the National Association of Business Economics on Tuesday. Crypto watchers will look to the Federal Reserve Chair's speech and new US employment data published on Friday for hints that the central bank may cut interest rates again.
Low interest rates translate to people having more money to invest, which means traders in general have a greater appetite for risk-on assets like cryptocurrencies.
Bitcoin rose nearly 10% after the Fed announced a 0.5% cut in mid-September.
“They say don't fight the Fed. Also don't go to war with China. “Certainly do not fight the Fed and China together,” Brickell and Mill wrote.
CME Group's FedWatch tool has a 60% chance the central bank will cut another 0.5% on November 7. A 0.25% cut has a 40% chance.
Eric Johnson is the news editor for DL News. Got a tip? Email at [email protected].
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