Bitcoin regains momentum and surpasses $110,000 fueled by optimism regarding a potential decrease in US interest rates, supported by a return of risk appetite.
Rebounding beyond Bitcoin
The entire crypto market benefits from this surge: Ethereum surpasses $4,000, Solana and XRP gain over 5%, driven by renewed demand for spot ETFs.
Bitcoin is on the rise. After several days below the symbolic $110,000 mark, the world’s largest cryptocurrency surged to $111K this Monday morning, gaining over 4% in 24 hours. This upward trend is fueled by growing hopes of a decrease in US interest rates and a slight return of risk appetite.
The effect has spread across the entire crypto market. Ethereum has gained 4.6% to surpass $4,000 again, BNB soared by over 4%, XRP by 6%, and Solana gained 5%. This synchronized rally marks a return to optimism after several sessions marred by economic tensions between Washington and Beijing.
Market expectations for monetary easing
Despite the tremors caused by Donald Trump’s tariffs against China and concerns about American regional banks, investors are now betting on monetary relaxation. The CME futures show a near 99% probability of a 25 basis point reduction at the next Fed meeting.
Jerome Powell, Chairman of the Federal Reserve, acknowledged that the growth remained stronger than expected, but the weakness in the job market persisted. As a result, bond yields decline, liquidity eases, and risky assets, including cryptos, breathe a sigh of relief.
Key technical thresholds to watch on Bitcoin
According to analysts at Kronos Research, critical levels are now at $107,000 and $111,000. A break below $107,000 could trigger a wave of liquidation and a sharp market sentiment plunge, especially if geopolitical tensions resurface.
Conversely, staying above $111,000 could trigger a short squeeze, meaning a series of forced buybacks of short positions. In this scenario, Bitcoin could target the $115,000 zone, where the next major resistance lies, according to CIO Vincent Liu.
The Chinese risk looms large
Despite the elation of the day, caution is still advised. The upcoming Trump-Xi summit at the end of the month poses a considerable political risk to the markets. Any announcement regarding US-Chinese trade relations could abruptly reverse the trend.
The next few days are crucial. Between US inflation figures, manufacturing sector statistics, and Australian economic data, each release could redefine Bitcoin’s trajectory and determine whether this rebound was just a breather… or the start of a new bullish momentum.
