Overnight BTC Stays Above $65k, Eyes $66k, Could Fed Rate Cuts Fuel Another BTC Surge?Bitcoin continued to hold above the $65,000 mark overnight, aiming for $66,000. Following recent Fed rate cuts, markets like gold, US equities, and China's A-shares have seen a surge in sentiment, but Bitcoin seems to be lagging behind
Overnight BTC Stays Above $65k, Eyes $66k, Could Fed Rate Cuts Fuel Another BTC Surge?
Bitcoin continued to hold above the $65,000 mark overnight, aiming for $66,000. Following recent Fed rate cuts, markets like gold, US equities, and China's A-shares have seen a surge in sentiment, but Bitcoin seems to be lagging behind. However, some analysts believe Bitcoin's current price is undervalued and its true value could exceed $120,000 to $140,000.
Bitcoin Undervalued by 50%, True Price Could Exceed $120,000 to $140,000?
Researcher GameofTrades analyzed the divergence between Bitcoin and the S&P 500 over the past six months, as well as the negative correlation between Bitcoin and the US Dollar Index, and concluded that Bitcoin's current market price is undervalued by as much as 50%.
Significant Negative Correlation Between Bitcoin and the US Dollar Index
Bitcoin is a sensitive indicator of US dollar weakness and has a negative correlation with the US Dollar Index (DXY). Historical data shows that Bitcoin has seen significant gains during periods when the DXY has declined, such as in 2013, 2017, 2020, and 2023.
Fed Rate Cuts Favor Bitcoin
The Fed has officially initiated rate cuts, signaling that the US dollar will begin another round of decline along with US Treasury yields. Additionally, the Fed's latest communication mentions its future policy direction, leading the market to expect two more consecutive rate cuts in the last quarter of 2024, with a possible 50 basis point cut in November. This era of joint easing by the US and China could drive a new surge in Bitcoin.
Historical Data Shows That When Bitcoin Is Significantly Undervalued, It Often Experiences a Big Breakout
Researchers point out that Bitcoin's current market price is undervalued by approximately 50%. Historically, instances of such significant undervaluation have been observed in January 2019, September 2020, and January 2023. What's notable is that all three instances of substantial undervaluation preceded major Bitcoin rallies without exception.
Altcoin Market: In and Out Quickly, Capitalize on Hot Topics
The bullish sentiment in the crypto market is driving opportunities in the altcoin space. However, the spot market has moved beyond discussing price fluctuations. Instead, focus should be on industry narratives and identifying promising sectors and potential breakout projects.
This year's altcoin market suggests taking a quick in-and-out approach and focusing on short-term trading.
5 Altcoins with 20x Potential
1. Sei (SEI): Sei has recently made headlines, and its native token Sei has been hitting new highs. The market sentiment is clearly bullish, but it's important to keep an eye out for potential price reversals in October.
2. Pepe (PEPE): Originating from the internet meme Sad Frog Pepe, PEPE coin had a breakthrough in 2023 and is poised for a big year in 2024. It's fresh, its fan base is growing, but it's still relatively new, so market volatility is high.
3. Sui (SUI): Another L1 with high potential, already experiencing significant price appreciation. A pullback or consolidation might be in the cards, but it's still worth closely monitoring for potential downside.
4. Strike (STRK): A decentralized finance (DeFi) lending platform based on Ethereum. Its current market cap is still relatively small, but as the DeFi ecosystem expands, its potential will be unleashed.
5. PEOPLE (PEOPLE): As a representative MEME coin, it has attracted numerous investors with its unique community culture and strong support base. High risk comes with high-reward opportunities.
Summary
Bitcoin's current price could be undervalued, and Fed rate cuts are expected to provide new momentum for growth. In the altcoin market, it's recommended to enter and exit quickly, seizing opportunities in hot sectors and tokens. Remember not to get carried away during investment and take profits when appropriate.
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