Could Fed Move Fuel Bitcoin's Bull Run?
Bitcoin’s recent drop from $102,760 to $92,500, due to stronger-than-expected US jobs market data, has bloodied the crypto market.
The data signaled economic recovery, putting pressure on both stocks and cryptocurrencies. However, amid the volatility, Jamie Coutts, chief digital asset analyst at Real Vision, sees a brighter outlook for Bitcoin, predicting a sharp price increase over the next six months.
Fed Move Could Fuel Bitcoin’s Bull Run
Coutts argues that the Federal Reserve is likely to cut interest rates soon, injecting much-needed liquidity into the financial system. He believes this will provide a strong boost to Bitcoin prices. Coutts highlights the strong correlation between the global money supply (M2) and Bitcoin as M2 expands, Bitcoin follows this trend, making the current environment ripe for a potential bull run.
“Despite the strong dollar keeping Bitcoin below $80,000, underlying demand remains strong,” Coutts explained. He suggested that market participants have been anticipating the Fed’s next move, which could set the stage for Bitcoin to move higher.
Wealthy Investors Eye Bitcoin's Long-Term Potential
Another factor driving the optimism is the growing interest in Bitcoin among high net worth individuals and families. These investors, unlike day traders who focus on short-term liquidity fluctuations, are focused on Bitcoin’s long-term value proposition. Coutts believes that this shift in adoption will play a key role in sustaining Bitcoin’s bullish momentum.
Market Outlook: Short-Term Hurdles, Long-Term Gains
Currently trading at $94,592, Bitcoin is down 2.4% over the past day. Analysts expect the cryptocurrency to consolidate between $92,000 and $90,000 in the short term, with a potential upside move in February. However, a daily close below $90,000 could trigger a steeper correction, possibly to $78,000–$74,000.
Despite these challenges, Coutts remains confident in Bitcoin’s resilience. With increasing liquidity, wider adoption, and innovative developments in the cryptocurrency space, Bitcoin could be poised for a major rally in the coming months. For investors, the coming period could be one of opportunity and transformation.