- Bitcoin began the week at $114,505, with minimal CME gap, signaling room for early-week recovery.
- An 87% probability of a Fed rate cut in September is shifting investor attention to risk assets like Bitcoin.
- Analysts identify $118,000 as a resistance zone, projecting a potential surge toward $124,000 in the short term.
Bitcoin opened trading on August 4 at $114,505, showing resilience after the weekend with minimal movement in the CME gap. Analysts observed that this lack of a weekend gap could pave the way for a short-term price recovery.
The CME FedWatch Tool indicates that 87% of market participants anticipate a 25-basis-point rate cut in September. If realized, the new target range would stand between 4% and 4.25%. This expectation is contributing to rising optimism in the cryptocurrency market.
Investor appetite is expected to increase with potential policy easing
Following the last rate cut in December 2024, investor risk appetite surged. Historically, a lower interest rate environment has weakened the dollar and pushed demand for alternative assets like Bitcoin. Market participants are positioning ahead of the September 17 meeting, which could lead to early price rallies.
Technical analysts are highlighting the potential for short-term downward movement. According to Crypto Raven, Bitcoin may dip toward the $110,000 to $112,000 zone before rebounding. A key resistance lies at $118,000, which he believes could act as a stepping stone toward $124,000.
Volume patterns show potential for upward movement
Crypto Raven bases his forecast on volume profile analysis, which tracks trading activity to identify zones of interest. High trading volume often acts as a price magnet, guiding market direction. He notes that recent activity supports the possibility of a rise following a temporary pullback.
Analyst Daan Crypto pointed out that monthly trading trends often include a brief early dip followed by a strong upward movement. He noted that this pattern has occurred in most months during broader uptrends, indicating that the recent decline may be temporary.
While confirmation is still pending from the Federal Reserve, market participants appear to be frontrunning the anticipated rate cut. The next six weeks could be critical for Bitcoin’s price trajectory. Should the Fed proceed with easing monetary policy, BTC could break above $124,000.
