For Bitcoin to avoid such a fate, it needs to trade and close above $50,000 per coin until the Federal Reserve meeting on September 18.
Bearish traders, or those expecting the price of Bitcoin to go down, have surpassed bulls in futures trading. Bitcoin (BTC) tickers, currently down to $57,715, show that bears have overtaken bulls based on the funding rates in the futures market, as revealed by analyst and verified CryptoQuant author Axel Adler.
The analyst wrote in a Sept. 10 X post:
“Some information regarding the average Funding Rate and changing sentiments of traders – The orange bar has been added to the chart, Bears dominate Bulls this time around – We mustn’t wait too long for the result.”
In other words, downside risk does not have to mean more downside for the price of Bitcoin, according to Kristian Haralampiev, the structured products lead at Nexo. He told Cointelegraph:
“Overall funding rates have remained below average in the past weeks, and even BTC Basis APR has remained relatively flat despite the anemic price action, indicating balanced leverage in the market and strong end-of-the-year bullish projections.”
Evaluating BTC exchange rates, we can state that it has experienced a bearish market decline of over 4.3% during the past month and failed to surpass the $64,500 resistance level. The world’s first cryptocurrency also declined nearly 18% in the past three months, based on data from Bitstamp.
Interest Rate Cuts Could Catalyze Bitcoin Rally — As Long As BTC Remains Above $50,000
Fiscal measures that were long expected may start a parabolic trend for Bitcoin, as long as it does not break below the $50,000 psychological level.
In particular, as per Nexo’s Alees Haralampiev in an interview, Bitcoin’s further rise towards the end of 2024 will significantly rely on its performance above this crucial support level. He added:
“Bearish below $50,000 would wreak further havoc on the Bitcoin price and create a period of consolidation as the above chart depicts. An interest rate cut could then become the key driver of a late 2024 Bitcoin rally if the dollar stays above $50,000.”
Bets for a Federal Reserve rate cut after the meeting scheduled for September 18 could trigger the next Bitcoin movement upwards. From the latest stats obtained from the CME FedWatch tool, the prediction of a 25-basis-point rate cut is at 83%, while that of a 50-basis-point rate cut stands at 17%.
Haralampiev added:
“Should Bitcoin uphold the price floor at $50,000, further rate cuts will ignite a mass stir.”
Bitcoin ETFs Break the Eight-Day Bleeding Streak
The Bitcoin exchange-traded funds (ETFs) had a net outflow for eight days in a row; however, they began to build back again today.
US ETFs posted another day of inflows on Sept. 10, where overall, these products gathered an aggregate of $117 million worth of Bitcoin, data from Farside Investors shows. Haralampiev added that Bitcoin ETF inflows “indicatively reflect the sentiments within the crypto market.”
By February 15, as it hit above $50,000, ETFs alone made up roughly 75% of new capital invested in BTC.