US Fed Rate Cut in Sight: Will Bitcoin (BTC) Explode in August?
Bitcoin Market Analysis & Interest Rate Outlook
Data shows Bitcoin price has remained flat throughout August, but the election year and low inflation print can be bullish. The Fed rate cut is on the radar. After a successful Bitcoin conference last weekend, this week will be crucial for Bitcoin and the broader crypto market as the US Federal Reserve will announce its interest rate decision on July 31. The Bitcoin price is showing strength, trading nearly 15% up on the monthly chart and moving closer to $70,000.
Potential Breakout Challenges in August?
Investors will be keenly watching the Fed’s stance on interest rate cuts at the upcoming FOMC meeting on July 31. As per the CME data, the probability of keeping interest rates unchanged in the next Fed meeting is 96%, while the probability of a 25 bps rate cut in September is 85.8%. Along with the Federal Reserve, the UK Central Bank will also announce its rate cut decision this week.
According to data from 10x Research, it would be too early to expect a Bitcoin price breakout in August. It noted that Bitcoin returns tend to be usually flat during the month of August and go down further in September. However, the report adds that tailwinds from the US election calendar, interest rate policy, and lower inflation could provide potential support, especially with $1 billion of token unlocks scheduled for August. Bitcoin’s dominance is expected to continue making new highs during this cycle with notable implications, said 10x Research.
Although analysts predict an eventual breakout above $70,000, Bitcoin might require further macro support, such as another round of lower inflation and projected Fed rate cuts, to trigger the upward rally. The US CPI report is scheduled for August 20. Additionally, Solana has been showing significant strength in the altcoin space, with the SOL price rallying to $192 as of press time, and investors are keenly expecting a surge past $200 in the near term.
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