Bitcoin Jumps 6% in One Day, Reaching Four-Month High
The Bitcoin market is currently undergoing some adjustment after this rapid ascent.
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Divergent opinions on interest rate policy within the Fed and conditional pause hints positively affected the market, improving investor sentiment.
The Bitcoin market is currently undergoing some adjustment after this rapid ascent.
The biggest factor behind this Bitcoin surge is the easing of concerns about US benchmark interest rate hikes. Specifically, Federal Reserve Governor Christopher Waller's statement that he would be willing to support a rate freeze if evidence of easing price pressures emerged sent a positive signal to the market. Furthermore, US weekly jobless claims, at 206,000, did not significantly deviate from expectations, indicating stable employment figures.
Following Federal Reserve Governor Christopher Waller's remarks, the likelihood of a September rate freeze significantly increased. According to FedWatch, the probability of a September rate freeze surged from 36.8% the previous day to 49.5% in one day, now approaching 50%. This demonstrates that comments from Fed members, who previously held hawkish stances, supporting a freeze are having a major impact on the market.
Within the Federal Reserve, a tight standoff continues between those advocating for interest rate hikes and those supporting a freeze. Currently, five members are cited as advocating for hikes: Lorie Logan, Beth Hammack, Neel Kashkari, Lisa Cook, and Michael Barr. Conversely, three members supporting a rate freeze include Michelle Bowman, John Williams, and Christopher Waller, who recently spoke.
Typically, opinions tend to converge without significant differences, but the current 5-to-4 standoff is considered an unusual situation as the Fed's policy decision approaches.
It's rare, as far as I know, for things to be like this with less than two weeks until the FOMC. As the CEO explained before, usually it's not such a close call, like 5-6 to 4.
His remarks significantly contributed to raising market expectations for interest rate cuts.
This shows that the market tends to front-run price changes in anticipation of major economic indicators or policy shifts. The upcoming non-farm payrolls data is also expected to show a similar pre-reflection.
But now it's 50-50. Strictly speaking, the probability hasn't reverted to what it was a week ago. Yet the price has already gone up. This clearly shows that it was accurately pre-reflected.
Reports recently emerged that the Securities and Exchange Commission (SEC) Chairman made remarks supporting the bill's passage, which the market is interpreting positively. The SEC Chairman reiterated guidelines for rule-making (Regulation Crypto) and indicated that discussions would resume after Congress reconvenes.
Federal Reserve Governor Christopher Waller's remarks on a rate freeze come with the condition of 'if inflation indicators are properly confirmed,' requiring caution. Since he set the condition of confirming downward inflation pressure without clear figures or criteria, future FOMC decisions may be made based on Fed members' subjective interpretations. This could act as a factor adding uncertainty to the market.
In particular, the Consumer Price Index (CPI) data is scheduled to be released next Thursday, which could significantly influence the Fed's interest rate policy decisions. Additionally, discussions on the Clarity Act will continue as Congress reconvenes, necessitating ongoing market monitoring.
The recent sharp rise in the yen's value is impacting global financial markets, including causing a sharp decline in Korea's KOSPI. This could increase the likelihood of a yen carry trade unwind (liquidation), requiring careful monitoring. Specifically, the speed of exchange rate fluctuations acts as a key risk measurement indicator, and rapid changes can cause significant shocks to the market.
Bitcoin price is currently at a critical technical juncture. A thick resistance zone has formed between $80,000 and $90,000, and breaking through this range is key. Experts believe that Bitcoin must surpass $100,000 to enter a full-fledged bull market.
Many engage in high-leverage trading out of a desire to quickly recover losses, but such investments have a very low success rate and can lead to significant losses. As seen in the case of famous investor 'James Win,' who succeeded with high-leverage investment only to eventually lose everything, individual investors are urged to exercise extreme caution.
Therefore, high-leverage investors need to respond even more sensitively to market volatility.
Hosted by Representative Moon Jin-seo, its importance was highlighted as it falls under the purview of the Finance and Economy Committee. During the debate, opinions were raised that taxation policies should consider the competitiveness of the rapidly growing crypto industry, rather than solely focusing on securing tax revenue.
Experts argue that a more rational and clear taxation plan, considering the characteristics of the digital asset market, is urgently needed.
Answers come from the transcript, with the exact spot cited.
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