The US Federal Reserve cutting interest rates earlier than the market expects could drive Bitcoin back up toward $112,000, says a market analyst.
“When these two further rate cuts come, if they’re coming a lot sooner than expected, that will then impact heavily on the future price moves or crypto on Bitcoin and some other cryptos as well,” CMC Markets market analyst Carlo Pruscino told Cointelegraph.
“The upside target that traders have in mind is $112,000 for Bitcoin, that is the psychological level,” Pruscino said.
Fed has “enough data” but unknown factor still in play
On May 22, Bitcoin hit a new all-time high of $111,970 but has since pulled back to $102,766 at the time of writing, according to CoinMarketCap.
However, market participants are confident that the Fed will hold interest rates at its upcoming decision on June 18. According to CME’s FedWatch Tool, 97.5% expect the rate to remain between 4.25% and 4.50%.
Pruscino said the Federal Reserve has “enough data” to make a decision but is still facing uncertainty due to US President Donald Trump’s tariffs.
“As they’ve mentioned many times in their statements, the unknown is tariff policy and trade policy, so they need to have some clear evidence on that,” Pruscino said.
“There needs to be a continuation of risk on improved risk sentiment for $112,000 to be cracked, to push higher when you get catalysts,” he added.
US Jobs report will be a key indicator
The US Court of International Trade blocked Trump from imposing his tariffs on May 28, arguing that he overstepped his authority. However, an appeals court allowed them to continue, and Trump recently doubled tariffs on foreign steel and aluminum to 50%.
Pruscino said the US jobs report, set to be released by the Bureau of Labor Statistics on June 6, will be a key indicator for both the Fed interest rate cut and Bitcoin’s near-term price action.
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“Going into this number here, we’ve had some weak US activity just recently. So the number’s going to try and be strong enough to negate some of that weak activity that we’ve had,” he said.
But a strong report may further delay any chance of a rate cut from the Fed, Pruscino said.
“If you get a large number of, say, plus 250,000 jobs, then that’ll be a slight surprise to the markets, and that will then lead the markets to think, well, perhaps the Fed Reserve may further delay their rate cuts this year,” he said.
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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.
