Bitcoin's Price Dynamics with Anticipated Fed Rate Cuts

The crypto market could see potential benefits from anticipated Federal Reserve rate cuts in May. Bitcoin experienced a slight increase, surpassing the $43,000 mark as markets expect the start of the rate-cutting cycle in May, during the Federal Open Market Committee (FOMC) meeting. This expectation is based on current pricing in Fed funds futures contracts, which reflect the market's outlook on future interest rates.

Federal Reserve Chair Jerome Powell ruled out an earlier rate cut in March, explaining that they need to be more confident about inflation moving down to 2%. However, the analyst suggests that higher interest rates and recent US job data could increase the likelihood of an earlier rate cut due to potential systemic risks in the banking system and rising unemployment rates, particularly affecting regional banks with significant exposure to US commercial real estate.

Regarding the crypto market's reaction, it's expected that cryptocurrencies, including Bitcoin, may initially experience a sell-off due to the potential delay in the rate cut until May, driven by declining global growth expectations and concerns about a US recession. However, the reversal in monetary policy in May, combined with a weak US dollar, could provide a significant boost as a second-order effect.

After rebounding from the 100-day moving average and targeting the yearly high of $48,000, Bitcoin encountered resistance at $43,578. This resistance could potentially trigger a pullback towards the 100-day moving average. However, if it successfully overcomes this barrier, the price could surge past $48,000. The price movements signal uncertainty after reaching $48,000, and only a clear breakout can pave the way for further advancement toward the next significant target in the $52,000 area.