BTC Hits $61,805: Fed Rate Cut Signals and RFK Jr.’s Trump Endorsement Fuel Rally

BTC Eyes $62,000 on US Politics and the Fed

On Wednesday, August 21, BTC rallied 3.50%, reversing a 0.73% loss from the previous day, to close at $61,135. BTC climbed to a high of $61,805. The total crypto market cap rose by 2.79% to $2.107 trillion.

FOMC Meeting Minutes Signal September Fed Rate Cut

The FOMC Meeting Minutes on Wednesday, signaled a possible September Fed rate cut, boosting BTC demand. The minutes showed that committee members viewed the current monetary policy stance as restrictive, which may adversely impact the US economy. Members also observed that the risks to achieving the Fed’s ‘employment and inflation goals had continued to move into better balance.’

In response, BTC rallied from $59,971 to a session high of $61,805.

Robert F. Kenney Jr. Gives BTC an Extra Boost

Investors also responded to Robert F. Kennedy Jr.’s plans to drop out of the US Presidential Election race to endorse Donald Trump for President. RFK Jr.’s running mate, Nicole Shanahan, reportedly said,

“The campaign is considering whether to join forces with Trump to prevent the risk of Vice President Kamala Harris winning the election.”

RFK Jr. had previously voiced his support for BTC, saying,

“I would like to have the federal government begin to buy Bitcoin and, over my term in office, ultimately have an equivalent amount of bitcoin that we have gold.”

Similarly, Trump pledged to build a national stockpile of BTC if elected. The Republican Party front-runner continues to target the crypto vote since plugging cryptos in May, saying,

“If you like crypto in any form…and it comes in many forms…if you’re in favor of crypto, you better vote Trump.”

Trump has also said he would fire Gary Gensler.

In contrast, Kamala Harris dashed hopes of a bipartisan for crypto by considering Gary Gensler as Treasury Secretary.

A Trump victory in November could push BTC toward $100,000. Conversely, a Kamala Harris win may send BTC below $50,000.

Cryptos in the Political Arena

Pro-crypto lawyer James Murphy, known as MetaLawMan, compared the Democrat and Republican Party platforms on crypto, saying,

“Republican: Republicans will end Democrats’ unlawful and unAmerican Crypto crackdown and oppose the creation of a Central Bank Digital Currency. We will defend the right to mine Bitcoin, and ensure every American has the right to self-custody of their Digital Assets, and transact free from Government Surveillance and Control. Democrat: No mention of crypto in 91 page platform document.”

US BTC-Spot ETF Market Extends Inflow Streak

On Wednesday, US BTC-spot ETF market inflows mirrored sentiment toward the Fed rate path and Trump as President.

According to Farside Investors,

• Grayscale Bitcoin Trust (GBTC) saw net outflows of $9.8 million.
• Grayscale Bitcoin Mini Trust (BTC) had net inflows of $14.2 million.
• Fidelity Wise Origin Bitcoin Fund (FBTC) reported net inflows of $10.7 million.
• Bitwise Bitcoin ETF (BITB) saw net inflows of $10.0 million.

Excluding flow data for iShares Bitcoin ETF (IBIT), the US BTC-spot ETF market saw total net inflows of $31.1 million, eying a possible five-day net inflow streak.

US BTC-spot ETF inflow trends could mitigate supply risks from the US government and Mt. Gox BTC stockpiles. On Thursday, August 22, the US government held 203,239 BTC while Mt. Gox had 34,164 BTC ($2.08 billion) remaining to repay creditors. Oversupply remains a BTC headwind.

A sizable US government BTC sale could push BTC down toward $55,000. However, upward US BTC-spot ETF inflow trends could counter oversupply risk, possibly pushing BTC toward $70,000.

US Economic Calendar

On Thursday, August 22, US jobless claims and Services PMI figures will require consideration. Softer labor market data and services sector activity could fuel speculation about multiple 2024 Fed rate cuts.

A more dovish Fed rate path may boost BTC demand. Conversely, a spike in jobless claims and Services PMI drop toward 50 may retrigger speculation about a possible US economic recession. Recession fears may negatively impact BTC and the broader crypto market.

Investors should remain alert amid possible changes to supply-demand trends. Stay updated with our latest news and analysis to manage exposure to BTC and the broader crypto market.

Technical Analysis

Bitcoin Analysis

BTC remained below the 50-day EMA while sitting above the 200-day EMA, sending bearish near-term but bullish longer-term price signals.

A breakout from the 50-day EMA may support a move toward the $64,000 resistance level. Furthermore, a break above the $64,000 resistance level could bring the $69,000 resistance level into play.

US economic data, US BTC-spot ETF market flow trends, and supply-related news require consideration.

Conversely, a break below the $60,365 support level could bring the 200-day EMA into play. A fall through the 200-day EMA may signal a fall toward $55,000.

With a 54.08 14-Daily RSI reading, BTC could break above the $64,000 resistance level before entering overbought territory.

Ethereum Analysis

ETH remained well below the 50-day and 200-day EMAs, affirming bearish price signals.

An ETH break above the $2,664 resistance level could support a move toward $2,800. Furthermore, a breakout from $2,800 could give the bulls a run at the 50-day EMA.

US ETH-spot ETF market-related news also requires consideration.

Conversely, an ETH fall through $2,500 could give the bears a run at the $2,403 support level.

The 14-period Daily RSI reading, 42.16, suggests an ETH break below the $2,403 support level before entering oversold territory.