Reserve

Jerome Powell

Chair

Bitcoin

Bitcoin has fallen below $65,000 following a decision from the United States Federal Reserve to keep interest rates unchanged, along with reports of escalating conflicts in the Middle East.
On July 31, Bitcoin (<a href="https://cointelegraph.com/bitcoin-price">BTC</a>) dipped to $64,549, the first time it has fallen below $65,000 since July 25, <a href="https://coinmarketcap.com/currencies/bitcoin/" target="_blank" rel="noopener nofollow">according</a> to CoinMarketCap data. It briefly spiked to $65,075 before falling back again but hasn’t crossed the key level since. It is currently trading at $64,470.
<figure data-ct-non-breakable="true">
 <img src="https://s3.cointelegraph.com/uploads/2024-08/f2572caf-1661-407d-abcc-215e10667f49.png" alt="Bitcoin slips below $65K as Fed holds rates, hints at September cut" title="">
 <figcaption style="text-align: center;">
 Bitcoin is up 0.97% over the past 30 days. Source: CoinMarketCap
 </figcaption>
</figure>
The price movement followed the Federal Open Market Committee’s (FOMC) decision to leave interest rates at 5.25% to 5.5% in an expected move.&nbsp;
Fed Chair Jerome Powell said the <a href="https://cointelegraph.com/news/us-debt-bitcoin-adoption-hard-money">economy is expanding</a> at a “solid pace” with positive signs for GDP growth and Private Domestic Final Purchases (PDFP), despite consumer spending growth slowing in line with its plans to reduce inflation.
“Inflation has eased substantially from a rate of 7% to 2.5%. We are strongly committed to returning inflation to our 2% in support of a strong economy that benefits everyone,” Powell said in a July 31 <a href="https://www.youtube.com/watch?v=I6_8szN5zrE" target="_blank" rel="noopener nofollow">speech</a> following the announcement.
<figure data-ct-non-breakable="true">
 <img src="https://s3.cointelegraph.com/uploads/2024-08/6fe9ccc7-904f-43e8-92f9-b18a4161cb2d.png" alt="Bitcoin slips below $65K as Fed holds rates, hints at September cut" title="">
 <figcaption style="text-align: center;">
 Powell’s speech following the two-day policy meeting. Source: CNBC
 </figcaption>
</figure>
Prior to the announcement, markets did not expect the FOMC <a href="https://cointelegraph.com/news/bitcoin-traders-63k-sweep-fomc-btc-price-monthly-close">to alter rates until September</a>.
However, pseudonymous crypto commentator Seth notes that the relative strength index (RSI) for Bitcoin — which is used to spot the overbought and oversold levels on any asset — is “now oversold,” which is a potential buy signal.
“The FOMC is used to liquidate Degen Retails that don’t know how to trade and use way too high leverage,” Seth stated in a July 31 X <a href="https://x.com/seth_fin/status/1818752969698869623" target="_blank" rel="noopener nofollow">post</a>.
Related: <a href="https://cointelegraph.com/news/bitcoin-s-price-rally-to-70k-could-lure-buyers-to-xrp-kas-stx-and-jasmy">Bitcoin’s price rally to $70K could lure buyers to XRP, KAS, STX and JASMY</a>
The price plunge also comes after reports that Hamas leader Ismail Haniyeh was assassinated in the Iranian capital, Tehran, <a href="https://www.reuters.com/world/middle-east/hamas-chief-ismail-haniyeh-killed-iran-hamas-says-statement-2024-07-31/#:~:text=CAIRO%2FDUBAI%2C%20July%2031%20(,a%20wider%20Middle%20East%20war." target="_blank" rel="noopener nofollow">according</a> to a July 31 Reuters report.
It is not the first time that Bitcoin’s price has declined following <a href="https://cointelegraph.com/news/bitcoin-briefly-dips-under-60k-amid-middle-east-crisis">rising tension in the Middle East</a>.&nbsp;On April 19, Iranian state media reported that explosions had been heard at Isfahan airport in central Iran. Within two hours, Bitcoin dropped 5.44% to $59,698.
<h3 data-ct-non-breakable="true" id="observers-optimistic-of-september-rate-cut">Observers optimistic of September rate cut</h3>
“While Fed Chair Powell has not confirmed a September rate cut, he sounds more optimistic,” trading resource The Kobeissi Letter <a href="https://x.com/KobeissiLetter/status/1818719557319610852" target="_blank" rel="noopener nofollow">wrote</a>.
“Ultimately, the Fed awaits the next 2 months of inflation data. Further declines in inflation open for a September cut,” it added.
Moody’s Analytics chief economist Mark Zandi expects the inflation data to match the Fed’s forecast, making a September rate cut likely.
“The inflation data must cooperate for the Fed to follow through, but all indications are that it will. Global investors are cheered by this - stocks are up a lot and bond yields are down,” Zandi <a href="https://x.com/Markzandi/status/1818727797894136041" target="_blank" rel="noopener nofollow">wrote</a>.
Meanwhile, MN Trading founder Michael van de Poppe <a href="https://x.com/CryptoMichNL/status/1818718382788952210" target="_blank" rel="noopener nofollow">believes</a> Powell’s “dovish tone on the future” is only good news for Bitcoin and altcoins. 
Magazine:&nbsp;<a href="https://cointelegraph.com/magazine/bitcoin-price-prediction-ethereum-altcoins-crypto-trader-roman-hall-of-flame-cointelegraph/">Ethereum price will lag for ‘months’ as Bitcoin surges: X Hall of Flame, Roman</a>
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Bitcoin slips below $65K as Fed holds rates, hints at September cut

Table of Contents

Cointelegraph

Other articles published on Aug 1, 2024

Crypto Scams on the Rise: Fake Video Conferencing Apps Target Job Seekers for Crypto

Anoma Crypto Venture Funding Seeks $40 Million at $1 Billion Valuation

Terra (LUNA) Founder Do Kwon’s Fate Has Been Decided – “This Time It’s Final, No Objections”

Solana Price Prediction: Will SOL Price Reach $200 Amid Market Fluctuations?

Can a Fed Rate Cut in September Drive a Bullish Crypto Move?

Trump Fuks Kamala (TRUMPKAM) Solana Memecoin Will Skyrocket Over 19,000%, While BTC Drops

Join our free newsletter for daily crypto updates!