A market analyst stated that if the U.S. Federal Reserve (Fed) lowers interest rates earlier than the market expects, it could drive the price of Bitcoin (BTC) back up to $112,000.
CMC Markets market analyst Carlo Pruscino told Cointelegraph in an interview, "If these two further rate cuts come much earlier than expected, it will have a significant impact on the future price movements of Bitcoin (BTC) and some other cryptocurrencies."
"The upward target in traders' minds is for Bitcoin to reach $112,000, which is a psychological barrier," Pruscino said.
According to CoinMarketCap, on May 22, Bitcoin hit an all-time high of $111,970, but as of the time of writing, it has fallen back to $102,766.
However, market participants believe that the Fed will maintain interest rates in its upcoming decision on June 18. According to CME's FedWatch tool, 97.5% of market participants expect rates to remain between 4.25% and 4.50%.
Pruscino stated that the Fed has "enough data" to make a decision, but still faces uncertainty due to U.S. President Donald Trump's tariff policies.
"As they have mentioned multiple times in their statements, the unknown factors are the tariff and trade policies, so they need to get some clear evidence in this regard," Pruscino said.
"There needs to be sustained risk appetite and improved risk sentiment to break through the $112,000 barrier and push prices higher when there are catalysts," he added.
On May 28, the U.S. International Trade Court blocked Trump from implementing his tariff policies on the grounds that he overstepped his authority. However, the appeals court allowed these policies to continue, and Trump recently doubled tariffs on foreign steel and aluminum to 50%.
Pruscino indicated that the U.S. employment report scheduled for release by the Bureau of Labor Statistics on June 6 will be a key indicator for the Fed's rate cut and Bitcoin's short-term price movements.
"Before this upcoming data is released, we have recently seen some weak U.S. economic activity data. Therefore, this data needs to be strong enough to offset some of the weak activity we have seen before," he said.
But Pruscino also noted that if the report performs strongly, it could further delay the possibility of a Fed rate cut.
"If the employment data shows a significant increase, such as more than 250,000 jobs, that would be a slight surprise to the market, and the market might think the Fed could further delay rate cuts this year," he said.
This article does not contain investment advice or recommendations. Any investment and trading activities involve risks, and readers should conduct their own research before making decisions.
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Original article: “Analyst: Fed Rate Cut Decision Will ‘Greatly Impact’ Whether Bitcoin (BTC) Reaches $112,000”
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