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Cryptocurrency News Articles
The final quarter of 2024 is here, and with that, high expectations for the massive bull run will melt the faces with new all-time highs (ATHs) for Bitcoin, altcoins, and meme coins. But are we really in for a good time ahead or will it be a pain of price
Oct 02, 2024 at 10:02 pm
The trillion-dollar cryptocurrency started 2024 on a great note, rising all three months of Q1 to record 68.68% returns in the entire quarter
The final quarter of 2024 is here, and with that, traders are looking at the massive bull run that will melt the faces with new all-time highs (ATHs) for Bitcoin, altcoins, and meme coins. But are we really in for a good time ahead or will it be a pain of price drops and sideways action?
Well, to determine that, we have to take a deeper look into all that’s going on in the crypto space. So, let’s see!
The Best September for BTC Marks a Green Q3
The trillion-dollar cryptocurrency started 2024 on a great note, rising all three months of Q1 to record 68.68% returns in the entire quarter, according to CoinGlass. This was followed by a red Q2, recording 11.92% losses.
While Q3 has been green, the gains have been a mere 0.96%. However, it brought us Bitcoin’s strongest September yet.
The price of BTC jumped 7.29% last month, the most BTC has ever had in the last 13 September that Bitcoin has had. Of these 12 September, eight have been red, bringing the average returns to the month at negative 3.77%.
But with a green September, BTC/USD is now trading at $64,000, down 13.3% from its peak of $73,740 hit in mid-March. Prior to the weekend, BTC/USD went up to $66,500, amidst monetary easing policies worldwide and institutional investments, before dumping this week just as US equity indexes did.
These losses came after Shigeru Ishiba, seen as a monetary policy hawk, was selected as Japan’s new prime minister. However, he is of the view that “monetary policy must remain accommodative as a trend.”
Interestingly, late in July, the Bank of Japan (BOJ) had a modest rate hike, which triggered an unwinding of the risk-on trades. The global panic in markets, which also saw BTC drop from about $65K to $50K in a matter of a few days, had the central bank reassuring that there won’t be any more hikes this year.
The bigger news, however, came from the US Federal Reserve Chair Jerome Powell on Monday, who crashed market expectations that future rate cuts will be as aggressive as the recent 50 basis point cut.
A Fresh Wave of Capital Ready to be Injected
The first-rate cut in four years, which sent the BTC price on an uptrend, came from the Fed two weeks ago, which lowered the federal funds rate to the 4.75%-5% range.
Lower US rates typically lead to a weakening US Dollar, and with USD being the primary quote asset for BTC, it leads to higher prices for the largest crypto asset. Also, by making holding cash less attractive and stimulating the economy, it moves investors into riskier assets like Bitcoin.
Around the same time, China also announced its biggest monetary and fiscal stimulus since the pandemic to help boost the country's economy and markets. The unveiling of the broader-than-expected package came last week that offers rate cuts and more funding to help the world's second-largest economy achieve its growth target.
The People's Bank of China (PBOC) has also introduced new tools to boost the capital market. This includes a swap program the size of an initial 500 billion yuan that will allow brokers, funds, and insurers easier access to funding to buy stocks and as much as 300 bln yuan in cheap loans to banks so that they can fund share purchases and buybacks of other entities.
Given that Chinese traders are known for their high-risk tolerance, increased demand from Chinese traders is expected to send crypto prices higher in the long run.
Meanwhile, in the US, Powell has disappointed the hopes of many investors that the Fed would implement yet another steep half-point rate reduction before the year ends.
“Looking forward, if the economy evolves broadly as expected, policy will move over time toward a more neutral stance,” said Powell, noting that there’s no preset course and the decisions will be made “meeting by meeting.”
Rate cuts are still in the pipeline, though, just at a measured pace to support an economy, which Powell says is healthy.
“Overall, the economy is in solid shape. We intend to use our tools to keep it there.”
– Powell
The Fed’s next rate decision will be its November policy meeting, which will come right after the presidential election. According to prediction market Polymarket, betters are giving a 25 bps rate cut in November, a 63% chance of happening. CME FedWatch, meanwhile, puts it at almost 40%.
So, Uptober
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