Bitcoin price: Reclaims $67k on rate cut hopes, is another rally on tap?
Bitcoin price rebounded sharply from recent losses on Thursday, tracking a broader rally in risk-driven markets after the Federal Reserve kept interest rates steady and signaled that rate cuts were coming in 2024.
Bitcoin jumped 6% to $67,113.9 by 07:48 ET (11:48 GMT), after sinking as low as $60,000 on Wednesday. The world’s largest cryptocurrency was walloped by a heavy bout of profit-taking before the Fed, after it raced to record highs last week.
The Wednesday decline was driven by profit-taking after last week's surge and leveraged bets on rising prices, leading to a more than 15% drop in overall capitalization.
Weakness in the dollar aided Bitcoin’s recovery, as the greenback fell sharply from two-week highs after the Fed. This trend also supported the broader cryptocurrency market, with world no.2 token Ethereum rising 10% on Thursday to $3,454.79.
The price recovery did not come as a surprise, Goldman Sachs analysts noted, “especially if one considers the speed at which we reached the mid-March ATH and the elevated perpetual futures funding rates that accompanied it as investors looked to put on leveraged longs on crypto retail exchanges.”
The Fed stuck to its forecast of a 75 basis point reduction in interest rates in 2024, while Chair Jerome Powell also flagged more, albeit slow progress towards the Fed’s 2% annual inflation target.
Lower interest rates bode well for Bitcoin, which benefits from a high-liquidity environment that encourages speculative investments. The token’s bull run in 2021 came largely on the back of ultra-low interest rates in the wake of the COVID-19 pandemic.
Bitcoin is already up more than 50% so far in 2024, after a stellar, over 100% rally through 2023. The token’s latest gains were
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