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The interest rate cut and the expectation of Trump's victory stimulate the market. Has the market entered the next stage?

The interest rate cut and the expectation of Trump's victory stimulate the market. Has the market entered the next stage?

BlockBeats2024/07/17 05:01
By:BlockBeats
Original title: "Interest rate cuts and Trump's victory expectations stimulate the market, Bitcoin bulls break through $65,000"
Original author: Mary Liu, BitpushNews


On Tuesday, the financial market continued to rise, with U.S. stocks, gold and cryptocurrency markets soaring across the board.


In the crypto market, Bitpush data showed that Bitcoin hit a four-week high during the session, soaring above $65,000 for the first time since the end of June. As of press time, the trading price was $64,804, a 24-hour increase of 1.9%.


The strongest performer among the mainstream altcoins was XRP, which rose 9% on Tuesday and expanded its weekly gains to 35%. The broader altcoin market also benefited from investor enthusiasm, with 90% of the top 200 tokens by market value rising.


The interest rate cut and the expectation of Trump's victory stimulate the market. Has the market entered the next stage? image 0


Worldcoin (WLD) performed best, up 24.3%, followed by Terra Classic (LUNC) up 20%, and Core (CORE) up 18.2%. WEMIX (WEMIX) was the biggest loser, down 8.3%, TRON (TRX) down 2.8%, and Uniswap (UNI) down 2.7%.


The overall market value of cryptocurrencies is currently $2.38 trillion, with Bitcoin accounting for 53.9% of the market.


In terms of U.S. stocks, at the close, the S&P 500, Dow Jones, and Nasdaq all rose, up 0.64%, 1.85%, and 0.20%, respectively. The Dow Jones Industrial Average continued its strong rise, breaking through 40,000 points and setting a new all-time high of 40,988 points.


Investors are increasingly convinced that a rate cut is imminent. The CME's Fed Watch tool shows that investors currently believe that there is a 100% chance of a rate cut in September. Influenced by this news, gold prices also soared to a record high, breaking through $2,474, up 1.87% on the day.


Mt.Gox selling pressure is "overestimated"


After hitting a high near $65,000 on Monday, Bitcoin retreated to $62,440 in early trading on Tuesday following news reports that Mt. Gox's Bitcoin had been transferred to Kraken for distribution to creditors.


Following the German government’s recent sale of 50,000 BTC, the Mt. Gox incident has once again raised concerns about a massive Bitcoin sell-off.


Akshay Nassa, founder of Chimp Exchange, believes: "Mt Gox has reignited the market's panic over Bitcoin selling, a trend that may have a greater impact on trader sentiment than the German sell-off. After this latest transfer, Mt Gox now holds 138,985 BTC, worth $8.86 billion. Repayments will come in the next few months and the beneficiaries are expected to sell their tokens. The market reaction is that BTC fell from $65,000 to $63,000. If no other positive news enters the market soon, the market reaction may be more severe."


The interest rate cut and the expectation of Trump's victory stimulate the market. Has the market entered the next stage? image 1


However, Ki Young Ju, CEO of cryptocurrency analysis firm CryptoQuant, believes that concerns about selling pressure are "overestimated" and will not derail the ongoing cryptocurrency rally.


He explained in the X post: "I believe that this repayment will not end the bullish trend, because these tokens are expected to react to market sentiment similarly to the existing Bitcoin supply. Unlike the German government's sell-off, Mt. Gox creditors were not forced to sell, so this is not pure sell-side liquidity."


Alex Krüger, a well-known cryptocurrency and macro analyst, estimates that if Mt. Gox creditors sell their recovered assets on a large scale, the price of Bitcoin will fall by up to 10%.


CoinMetrics also stated in a report that based on Bitcoin's current market depth and trading volume, if the liquidation of Mt. Gox creditors' assets is orderly and lasts for several weeks, the market should be able to absorb these assets.


“Assuming the liquidation is gradual and involves multiple exchanges, approximately 65,000 BTC (worth approximately $1.95 billion at current prices) could be absorbed by the market in a few weeks without causing major disruptions,” CoinMetrics analysts wrote.


Favorable political environment


In a report, Joel Kruger, market strategist at LMAX Group, argued that Bitcoin’s rebound can be attributed to buyers buying Bitcoin on dips and favorable shifts in the political sphere.


“We believe the price rebound is a combination of medium- and long-term players seeking to increase their positions after a healthy decline in BTC,” Kruger said. “We also see political factors influencing this rally, especially with the increased likelihood of President Trump being crypto-friendly over the weekend.”


Investors believe that the failed assassination attempt on former US President Donald Trump will benefit the performance of his Republican Party in the November election, and a Republican victory may bring favorable tax and fiscal policies to investors.


Jacob Martin, a cryptocurrency lawyer and co-founder of 2 Punks Capital, also believes that a favorable political environment has the potential to boost market sentiment.


Jacob Martin said in a report: "I think it's clear that one side is trying to support innovation and keep it in the United States, while the other side continues to speak out against large technology companies (or working with them), against small technology companies, and against innovation in areas such as artificial intelligence and cryptocurrency. More than 90 million Americans hold cryptocurrencies directly or otherwise through Coinbase or ETFs. Cryptocurrency and American forward innovation have become one of the few major issues worthy of consideration by single-issue voters. I think this is very important."


Trump's choice of vice president JD Vance, who supports cryptocurrency, also boosted the sentiment of crypto investors. In the hours after the nomination was announced, Bitcoin rose by about 3% in the short term.


“Cryptocurrency investors remain optimistic and if JD Vance can run alongside Trump in the White House (an outcome that looks increasingly likely), there is a sense that pro-cryptocurrency policies could be on the agenda by 2025,” said Neil Roarty, an analyst at Stocklytics.


Original link


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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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