Cryptocurrency market analysts believe that Bitcoin's recovery may continue, as the cryptocurrency has started to rise since hitting a low slightly above $82,000 on Friday.
Capriole Fund founder Charles Edwards stated in a post on X on Monday that the decline in tech stocks and the crypto market over the past two weeks "was due to the market's erratic expectations of interest rate cuts."
"As the market returns, it is expected to push Bitcoin a bit higher," he added.
Analysts from wealth management firm Swissblock noted that Bitcoin has taken the first step towards forming a bottom.
They added that this week is crucial, as it is necessary to "see the selling pressure continue to fade."
However, Swissblock indicated that there is usually a second wave of selling, which is weaker than the first, and prices hold above previous lows, becoming one of the most reliable bottom signals.
"The second wave typically marks seller exhaustion, with control shifting back to the bulls," the analysts added.
TradingView shows that Bitcoin fell to $80,600 on Coinbase on Friday, the lowest level since mid-April. This drop marked a 36% retracement from its historical high of over $126,000 in early October.
Edwards noted that the probability of the Federal Reserve cutting rates in December fell to around 30% last week but has since rebounded to 70%.
The CME Fed Watch tool, which tracks target rate probabilities, currently shows a 69.3% chance of a 0.25 basis point rate cut at the central bank's meeting on December 10.
"The market's expectations have changed significantly in just two days," said the market research X account "Global Markets Investor," who shared a chart predicting a reversal on Polymarket.
"I wouldn't be surprised if the Fed announces some sort of 'reserve management' approach at the next meeting… essentially liquidity expansion," market analyst "Sykodelic" stated on Sunday.
"The central bank has to inject liquidity at some point, or they will go bankrupt," they added.
Rate cuts and increased liquidity are generally favorable for high-risk assets like cryptocurrencies, which have seen significant rebounds following previous periods of quantitative easing.
Related: Jeff Park: Sovereign nations adopting Bitcoin (BTC) will be the ultimate upside catalyst
Original article: “Analysts: Bitcoin (BTC) Selling Pressure Eases, Recovery May Continue”
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