According to the latest insights from QCP Capital, the likelihood of a Federal Reserve interest rate cut this Wednesday remains markedly low. However, any dovish commentary from Chairman Powell could potentially ignite a favorable trajectory for Bitcoin. As the U.S. transitions from a phase of “fiscal dominance” characterized by expansive government spending to a more fiscally conservative approach under Trump, the emphasis on monetary policy is becoming more pronounced. Despite expectations of no abrupt rate cut, a shift in tone could instigate significant market activity.
Recent data indicates a slight moderation in macroeconomic volatility, evidenced by the VIX index retreating to approximately 20. Concurrently, Bitcoin’s price volatility has diminished, fluctuating between $80,000 and $85,000. With no fresh updates on tariffs, investor attention has turned back to geopolitical dynamics. Notably, gold has surged past $3,000 while Bitcoin appears to maintain an inverse relationship with it. Historically, the fluctuations in cryptocurrency prices tend to trail behind shifts in global liquidity, positioning Bitcoin for potential momentum as the Fed potentially pivots and Europe and China unveil new stimulus initiatives.