BTC Price Forecast: Fed Rate Cut Bets Fuel Demand Ahead of Consumer Sentiment Report

Bitcoin Resumes Upward Trend with a Brief Return to $58,500

On Thursday, September 12, BTC advanced by 1.43%, reversing a 0.53% loss from the previous session, closing at $58,178. Significantly, BTC briefly climbed to a session high of $58,579, marking its highest value since September 3.

Fed Rate Cut Bets Drive BTC Demand

On September 12, US economic data supported investor expectations of a September Fed rate cut.

Initial jobless claims increased from 228k in the week ending August 31 to 230k in the week ending September 7. Softer labor market conditions may affect wages and consumer spending, possibly affecting the US economy. Private consumption accounts for over 60% of US GDP.

Additionally, producer prices signaled weakening demand. In August, producer prices increased by 1.7% year-on-year, down from 2.1% in July. Producers typically lower prices if demand weakens, possibly dampening headline inflation.

Sentiment toward the Fed rate path shifted following the US data. According to the CME FedWatch Tool, the probability of a 50-basis point September Fed rate cut increased from 14.0% on Wednesday, September 11, to 43.0% on Thursday, September 12.

Expectations of a more dovish Fed rate path fueled BTC demand.

US BTC-spot ETF Market Registers Inflows Amid Rate Cut Bets

On September 12, the US BTC-spot ETF market experienced inflows for the third session of the week. According to Farside Investors,

• ARK 21Shares Bitcoin ETF (ARKB) saw net inflows of $18.3 million.
• Fidelity Wise Origin Bitcoin Fund (FBTC) reported net inflows of $11.5 million.
• Grayscale Bitcoin Trust (GBTC) reported net outflows of $6.5 million.

Excluding iShares Bitcoin Trust (IBIT) flows, US BTC-spot ETFs saw $39.0 million in net inflows, contributing to BTC’s gains. US BTC-spot ETF inflows indicate stronger BTC demand.

US Economic Calendar: Consumer Sentiment in Focus

On Friday, September 13, Michigan Consumer Sentiment figures will be in focus. Economists expect the Michigan Consumer Sentiment Index to rise from 67.9 in August to 68.0 in September. Higher-than-expected figures could dampen expectations of a 50-basis point September Fed rate cut, possibly impacting BTC demand.

Improving sentiment may drive consumer spending and fuel demand-driven inflation.

Investors should remain alert as shifting sentiment toward the Fed rate path could affect BTC demand. 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 and 200-day EMAs, confirming bearish price trends.

A break above the 200-day and 50-day EMAs could give the bulls a run at the $60,365 resistance level. Furthermore, a breakout from the $60,365 resistance level may bring the $64,000 resistance level into play.

US economic data, Fed interest rate cut bets, and BTC-spot ETF market flow trends require consideration.

Conversely, a drop below $57,500 could signal a fall toward the $52,884 support level.

With a 48.68 14-day RSI reading, BTC could drop below $55,000 before entering oversold territory.

Ethereum Analysis

ETH hovered well below the 50-day and 200-day EMAs, sending bearish price signals.

An ETH breakout from the $2,403 resistance level could bring the $2,500 level into play. Furthermore, a return to $2,500 may give the bulls a run at the $2,664 resistance level.

US ETH-spot ETF market-related updates also require consideration.

Conversely, an ETH drop below the September 6 low of $2,150 could signal a fall toward the $2,124 support level.

The 14-period Daily RSI reading, 41.35, indicates an ETH drop to the $2,124 support level before entering oversold territory.