Bitcoin Breaks Above $64,000 as Global Monetary Easing Expectations Heat UpTraders on Tuesday boosted the probability of the Federal Reserve cutting interest rates by 50 basis points for the second time in a row to 61%, as China also joined the near-global monetary easing movement currently sweeping major economies. This news pushed the price of Bitcoin to its highest level in over a month during US afternoon trading on Tuesday, breaking above the $65,000 mark for the first time since early August
Bitcoin Breaks Above $64,000 as Global Monetary Easing Expectations Heat Up
Traders on Tuesday boosted the probability of the Federal Reserve cutting interest rates by 50 basis points for the second time in a row to 61%, as China also joined the near-global monetary easing movement currently sweeping major economies. This news pushed the price of Bitcoin to its highest level in over a month during US afternoon trading on Tuesday, breaking above the $65,000 mark for the first time since early August.
As of press time, Bitcoin is up nearly 2% in the past 24 hours, trading at $64,300. The price had previously hovered just below $65,000, failing to break through it since the first week of August.
China overnight joined almost every other major global economy in easing monetary policy to counter economic slowdowns. The news sent the Shanghai Composite Index up over 4%, but the price of Bitcoin only saw a brief, modest increase.
The Conference Board reported a sharp decline in consumer confidence in September, with its overall index falling from 105.6 to 98.7, the largest monthly drop since August 2021. This news caused the price of Bitcoin to slip below $63,000 in early US trading. "Consumers' assessments of current business conditions turned negative, while views of current labor market conditions softened further. Consumers also became more pessimistic about future labor market conditions, and their optimism about future business conditions and future income decreased," said Dana Peterson of the Conference Board.
However, this news caused markets to expect the Fed to cut its benchmark interest rate by 50 basis points again at its November meeting, rising from 50% the previous day to 61% according to CMEFedWatch data from the Chicago Mercantile Exchange.
Meanwhile, the latest data showed a substantial increase in the US M2 money supply in August.
The loose monetary policies in China and the US, along with the increasing money supply, appear to have been the catalyst for Bitcoin's sustained rise in afternoon trading. Gold also benefited from this news, surging 1.4% to a new all-time high of $2,690 per ounce.
With today's rise, Bitcoin is currently up over 10% from a week ago. However, it's difficult to call this an upside breakout if the price remains below its levels from weeks ago. "Moving from cutting gains during volatility to letting winners keep running is psychologically tough. In my eyes, BTC market structure confirming a shift above $65,000 is the threshold for risk appetite and shifting that bias," wrote well-regarded analyst Will Clemente.
Overall, the global trend of monetary easing, and loose monetary policies implemented by both China and the US, appear to be providing strong support for Bitcoin. However, despite Bitcoin breaking above the $65,000 mark on Tuesday, analysts believe a sustained price above this level is needed to confirm a bullish trend.
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