One analyst says there’s only one leading indicator needed to predict whether Bitcoin can surpass its all-time high of $73,700 later in 2024, and it all rests with the US Federal Reserve.
“The high U.S. rate of return is a great indicator, and it really needs to get below 6 or 7% to get to an all-time sustainable high,” Timothy Peterson, founder and chief investment officer of Cane Island Alternative Advisors, told Cointelegraph. He explained that the primary measure he looks at for Bitcoin (BTC) price movement is interest rate movement.
At press time, the U.S. high yield rate — which represents the rate at which corporate bonds yield higher due to higher default risk — was 7.54%, according to YCharts data.
Peterson predicted that if return rates fall within the “6 or 7%” range, Bitcoin could see the long-awaited price of $100,000 by the fourth quarter of 2024, or at the latest, the second quarter of 2025.
Typically, a Fed cut in interest rates follows a rate hike, something nearly two-thirds of economists surveyed expect to happen in September, according to a recent Reuters poll.
Interest rates are seen as an important indicator for cryptocurrency traders, as lower interest rates typically result in a lower return for investors in safe securities such as bonds and term deposits.
As a result, more investors are turning to riskier assets like Bitcoin to achieve better returns on investment.
Markets are generally “stable and volatile” between September and October, Peterson said.
“Not always, but many times,” he commented. However, with the upcoming US elections, he claimed that “uncertainty will be higher throughout October” ahead of Election Day, currently scheduled for November 4.
Related: Bitcoin traders expect Fed Chair Powell to “pump our bags” and BTC to target $80k+
Meanwhile, cryptocurrency analyst Scott Melker, also known as the “Wolf of the Streets,” declared that Fed rate cuts are not always appropriate for assets outside of fixed income investments.
“There is a widely held theory that Fed pivot is good for markets,” he said on May 14. attack On X.
“Interest rate cuts generally precede larger declines,” he commented on the overall market.
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This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
