The Federal Reserve announced a 25 basis point cut to the benchmark interest rate, further boosting market confidence.
Written by: BitpushNews
On Thursday, the financial markets once again experienced a festive atmosphere, with assets such as cryptocurrencies, U.S. stocks, and precious metals collectively soaring, driven by positive factors like Trump's election victory and the Fed's interest rate cut.
Trump's re-election injected a strong dose of confidence into the market, as investors seemed generally optimistic about the future economic outlook of the United States, which in turn propelled a broad rise across various asset classes.
Meanwhile, the Federal Reserve announced a 25 basis point cut to the benchmark interest rate, a move that further bolstered market confidence. The rate cut not only lowers borrowing costs but also increases liquidity in the market, which is undoubtedly a significant boon for risk assets like Bitcoin. Additionally, the Bank of England also adopted a similar accommodative monetary policy, passing a proposal to cut rates by 25 basis points with a vote of 8 to 1, bringing the benchmark rate down to 4.75%, further solidifying expectations of global liquidity easing.
By the end of the day, the S&P 500 and Nasdaq indices rose by 0.74% and 1.51%, respectively, both hitting new highs, while the Dow Jones index remained flat, and spot gold rebounded above $2,700.
According to Coinmarketcap data, Bitcoin dipped to a low of $74,500 in the morning but surged after the rate cut announcement, with bulls pushing the price close to the historical high of nearly $77,000 ($76,943.12). As of the time of writing, Bitcoin was trading at $76,065.98, with a 24-hour increase of 0.6%.
The upward trend in altcoins continued, with Arweave (AR) leading the top 200 tokens by market capitalization, rising by 13.21%, followed by Mantle (MNT) and Cardano (ADA), which increased by 11.8% and 10.7%, respectively.
The overall market capitalization of cryptocurrencies is currently $2.57 trillion, with Bitcoin's market share at 58.8%.
Multidimensional data suggests institutional enthusiasm, and the rebound will continue
As a signal of increased demand from institutional investors, the daily trading volume of Bitcoin futures on the Chicago Mercantile Exchange (CME) hit a historical high of $13.15 billion on November 6. According to K33 research director Vetle Lunde, the average daily trading volume of CME Bitcoin futures for 2024 is currently $4.56 billion—higher than the surge in trading volume during the FTX collapse in early November 2022. This milestone indicates that the proportion of institutional investors in the market is growing.
Additionally, the Coinbase premium turned positive for the first time in weeks. CryptoQuant research director Julio Moreno stated, "Trump's victory has rekindled American investors' demand for Bitcoin, and the Coinbase premium has turned positive for the first time since October 18." As the largest cryptocurrency exchange in the U.S., the Coinbase premium indicates increased buying interest, especially among institutional investors making large trades on Coinbase.
A significant influx of funds into spot Bitcoin exchange-traded funds (ETFs) is fueling the bull market, with BlackRock's IBIT setting a record for the largest single-day trading volume yesterday, reaching $4.1 billion.
In the short term, resistance is around $83,000
From a technical perspective, TRDR.io's daily chart shows that there is a large sell order zone in the order book structure at a depth of 2.5%, located between $77,000 and $78,000, followed by what appears to be a clear path (i.e., a lack of significant selling pressure) up to $83,000.
The Fibonacci extension tool currently predicts that the upward trend will extend to $82,367, which aligns with the 1.618 level.
Veteran trader Peter Brandt emphasized on the X platform, "Bitcoin is currently in the best position of the bull market halving cycle, and prices should reach the range of $130,000 to $150,000 by August/September next year," noting that his "way of measuring cycles is different from most people."
Market analyst CryptosRus stated that compared to previous cycles, Bitcoin could reach $100,000 by early 2025.
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