Bitcoin failed to continue its upward trend despite multiple supporting factors such as a bearish US dollar and a dovish stance from the Federal Reserve. It lost some of its gains, dropping to around 63,400 and hitting an intraday low of 62,961.
Although Bitcoin began the week on a bullish note after dipping to a low of $56,000 last week, it surged to $64,000 on Monday, spurred by a cooler-than-expected US April jobs report. The report suggested a slowing economy, which could lead to reduced inflation and lower interest rates.
However, the increase in price was short-lived as BTC edged lower on Tuesday, possibly due to cautious sentiment ahead of a speech by Neel Kashkari, the President of the Federal Reserve Bank of Minneapolis. If his comments take a hawkish tone, signaling a stricter approach to interest rates, it could strengthen the US dollar and negatively impact BTC.
Marathon Digital Soars 18%: A Beacon in Bitcoin Mining Amid Market Uncertainty
Marathon Digital Holdings, a prominent player in the Bitcoin mining sector, recently witnessed an 18% surge in its stock price to $20.67, elevating its market capitalization to nearly $800 million. This significant increase followed the announcement that Marathon would be included in the S&P SmallCap 600 Index, underscoring its rising prominence within the cryptocurrency mining industry.
Key Points:
- Marathon Digital’s stock jumps 18%, market cap approaches $800 million.
- Inclusion in S&P SmallCap 600 highlights its growing industry importance.
- The company introduces an executive bonus plan to tie leadership gains to shareholder interests.
Despite Marathon’s stock success, Bitcoin itself has shown bearish trends, trading around $63,200, which reflects a complex sentiment in the broader market. This contrast suggests that while individual companies may thrive, the overall cryptocurrency market remains cautiously optimistic or mixed.
SEC Stalls on Ethereum ETFs While Investment Soars in Bitcoin Options
The U.S. Securities and Exchange Commission (SEC) has postponed its decision on approving Ethereum exchange-traded funds (ETFs) once again, extending the review period for Galaxy Invesco’s application by an additional 60 days to July 5. This delay continues a trend seen in earlier postponements affecting major financial players such as BlackRock and Fidelity, casting doubts on a near-term approval due to ongoing regulatory uncertainties. Analysts are increasingly sceptical about the likelihood of Ethereum ETF approval in the current climate.
- Key Points:
- SEC defers Ethereum ETF decision, extending Galaxy Invesco’s review to July.
- Historical delays for major applicants like BlackRock and Fidelity enhance regulatory unpredictability.
- In contrast, significant investments in Bitcoin ETFs, such as Hightower’s $68.35 million, highlight a diverging confidence level between Bitcoin and Ethereum ETFs.
While Ethereum faces regulatory hurdles, investment in Bitcoin ETFs is on the rise, with firms like Hightower directing substantial capital towards them, underscoring a stronger market confidence in Bitcoin. This trend suggests that the market may be favouring Bitcoin over Ethereum amid these regulatory uncertainties, potentially influencing Bitcoin’s price positively in the near term.
Anticipated Fed Rate Cuts Propel Bitcoin Demand Amid Weakening Dollar
The recent U.S. job market report has heightened expectations that the Federal Reserve may cut interest rates later this year, leading to a softer U.S. dollar and increased attractiveness of Bitcoin. Richmond Fed President Thomas Barkin supports maintaining current rates to manage inflation, while New York Fed President John Williams suggests potential rate reductions as early as September or November.
Markets now forecast a total reduction of 46 basis points by 2024, signalling a shift towards a more accommodative monetary policy. This anticipated easing has consequently bolstered Bitcoin’s appeal as a hedge against currency devaluation, driving up demand and potentially its price.
- Key Points:
- Anticipation of Fed rate cuts weakens the dollar, enhancing Bitcoin’s appeal.
- Potential rate cuts could total 46 basis points by 2024.
- Increased Bitcoin demand may lead to higher prices.
This growing interest in Bitcoin, spurred by the prospect of lower interest rates, underscores its role as an alternative investment during times of monetary easing, possibly leading to a sustained increase in Bitcoin’s market value.
On Tuesday, bitcoin price prediction seems bullish. The cryptocurrency is currently trading at $63,535, marking a 0.59% increase. The asset now hovers above its pivot point at $63,002, suggesting a potential bullish trajectory. Immediate resistance levels are identified at $65,512, followed by $67,331 and $69,441, which BTC needs to breach to sustain upward momentum.
Conversely, Bitcoin finds immediate support at $60,928, with further support levels at $58,927 and $56,625 that could provide stabilization in case of a decline. The 50-Day Exponential Moving Average, positioned at $62,631, aligns closely with the pivot point, reinforcing support for potential upward movement.
Key Points:
- Bitcoin’s immediate resistance at $65,512; breaking this could confirm continued gains.
- Support established around $60,928, crucial for short-term stability.
- Bullish trend likely if BTC maintains above $63,000; risks of sharp sell-offs if it falls below.
In conclusion, Bitcoin shows signs of a positive trend as long as it remains above $63,000. However, a drop below this critical level could trigger significant selling pressure.
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