Bitcoin Price Prediction If The Fed Cuts Interest Rates Tomorrow- Is BTC Headed to $143k?
Bitcoin price was stuck in a tight range today, July 29, as most market participants focused on the upcoming Federal Open Market Committee (FOMC) decision on Wednesday. This BTC consolidation could trigger a short-squeeze soon, especially if the bank cuts rates tomorrow.
Bitcoin Price Technical Analysis Signals a Surge is Coming
The daily timeframe reveals that Bitcoin price has remained at $118,500 today. It has been in this range in the past two weeks as the rally to its all-time high took a breather.
On the positive side, Bitcoin price is slowly forming the highly popular continuation pattern known as a bullish pennant. This pattern occurs after an asset experiences a parabolic rise, forming a vertical line that resembles a flagpole.
It then goes through a consolidation resembling a symmetrical triangle pattern. The bullish pennant often leads to a strong bullish breakout when the two lines are about to converge, which is happening now.
Therefore, it is likely that Bitcoin will have a strong surge in the coming days. The length of the flagpole is about 20%, and measuring the same distance from the potential breakout point gives it a target of $143,280.
This Bitcoin price target is notable because it matches perfectly with the one on the inverse head-and-shoulders that formed between January and July this year. The distance between the neckline and the head was about 32%, and the same from the neckline was $143,000.
The bullish long term BTC price forecast will be cancelled if the coin plunges below the upper side of the inverse H&S pattern at $109,380. A drop below that level will signal that there are still more sellers left in the market.
Federal Reserve Interest Rate Decision Ahead
The next major driver for the Bitcoin price will be Wednesday’s Federal Reserve interest rate decision. A major bullish breakout, potentially to its all-time high of $123,200 would happen if the bank decides to cut interest rates by 0.25% to between 4% and 4.25% in this meeting.
Historically, Bitcoin and other risky assets do well when the Federal Reserve is either cutting rates or when it turns dovish. Indeed, BTC price jumped to a record high after the bank started cutting rate last year.
However, it is unlikely that the Fed will cut interest rates in this meeting. The closely watched CME Fed Futures tool places the odds of a cut to just 3.1%. Odds of a September cut have soared to 63% and October 50%.
Bitcoin price will react to other macro events in addition to the Federal Reserve meeting. For example, the US will publish the first estimate of Q2 GDP data on Wednesday and the nonfarm payrolls (NFP) report on Friday.
Summary
BTC has numerous catalysts in the coming months. It will benefit from the potential monetary policy of the Federal Reserve, especially when it starts cutting rates. Bitcoin is also expected to rise due to the increasing inflows of exchange-traded funds (ETFs), which have now surpassed $55 billion.
Frequently Asked Questions (FAQs)
Odds are that the Bitcoin price will have a strong bullish breakout if the Fed decides to cut interest rates. The potential target will be $123,200, its all-time high.
It is likely that the Fed will not cut rates this week, as inflation remains significantly higher than its target.
It has formed a bullish pennant pattern, a popular continuation sign. It is also seeing strong demand from ETF investors.
crispus
Crispus is a seasoned Financial Analyst at CoinGape with over 12 years of experience. He focuses on Bitcoin and other altcoins, covering the intersection of news and analysis. His insights have been featured on renowned platforms such as BanklessTimes, CoinJournal, HypeIndex, SeekingAlpha, Forbes, InvestingCube, Investing.com, and MoneyTransfers.com.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
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