Bitcoin's price hit a three-week high on Friday, extending gains made over the weekend, as traders remained optimistic about several tailwinds expected in the coming months.
This includes the US Federal Reserve's decision to end its rate hike regime, which was raised from its 5.25%-5.5% target in July last year.
Other tailwinds include the outcome of the US presidential election in November, where candidates Donald Trump and Kamala Harris could determine the direction of crypto policy in the US.
Last week, Federal Reserve Chairman Jerome Powell hinted at a rate cut next month, indicating the US central bank is content to slow inflation and focus on growing labor market weakness.
The speech helped drive risk property.–including crypto–Higher, for the first time since August 2, Bellwether's asset bitcoin rose above $62,000.
Bitcoin rallied over the weekend, dropping below $65,000 to $64,000 before falling back to current levels, according to CoinGecko data.
Data from the US labor market added to investors' expectations that the central bank will cut rates in September.
“The Bureau of Labor Statistics has revised up 818,000 jobs, meaning new jobs reported over the past month to non-farm payroll data,” Ryan McMillin, chief investment officer of crypto fund manager Merkle Tree Capital, told Decrypt.
“This data was key to supporting the ‘hot job market' narrative, but it turns out it never happened,” he said, adding that selling pressure from the German and US governments, as well as from Gox and Genesis, is also evident. Be in the rear view.
“This setup could see bitcoin pay off its historic September weakness and move to new all-time highs; after six months of trading, a strong rally is in sight before the end of the year.” The head of investment said.
Bitcoin has hovered between $49,000 and $71,000 since the end of February, following a decision by the Securities and Exchange Commission to delist several exchange-traded funds linked to the asset and a subsequent fall from market euphoria.
McMillin's sentiment was echoed by QCP Capital, which wrote in a note to investors on Friday that Bitcoin is back in business “comfortably in the familiar $61,000 to $70,000 range.”
The sales supply is “gradually drying up” and ETFs have seen net outflows in the last 12 days, QCP said, citing recent investor preference for the asset.
Friday's rally is “mostly position-based,” QCP said, adding that the market should “expect to add long positions” if it holds the $62,000 price tag as the end of the summer holidays quickly approaches.
That means the market could see traders borrowing money to increase their investment, which could lead to an increase in asset prices.
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