Bitcoin (BTC) traded at $61,000 on July 3 after the United States inflation outlook worsened.
Fed's Powell kicks can on rate cut
Data from Cointelegraph Markets Pro and TradingView showed BTC price strength slowly recovering from a 2% dip at the daily close.
This compounded existing downside to produce local lows of $60,561 on Bitstamp, erasing gains from the weekend.
The mood appeared to worsen as Jerome Powell, Chair of the U.S. Federal Reserve, gave a speech on the economy and monetary policy at an event in Portugal.
The Fed, he explained, needed more convincing that conditions were right to lower interest rates — a key move being watched by crypto and risk-asset bulls.
“We just want to understand that the levels that we're seeing are a true reading on what is actually happening with underlying inflation,” he said, quoted by Reuters and others.
Markets slightly lessened the odds of a rate cut coming at the September meeting of the Fed’s Federal Open Market Committee (FOMC), with these still standing at around 65% at the time of writing, per data from CME Group’s FedWatch Tool.
“It's clear that the Fed will continue their ‘meeting by meeting’ approach,” trading resource The Kobeissi Letter wrote in part of a response on X (formerly Twitter).
“While markets are expecting 2 rate cuts this year, the Fed's latest guidance says 1 cut is coming. The next few months are crucial.”
Bitcoin hashrate drop may spark "healthy overdue correction"
Bitcoin market participants thus watched frustrated as BTC/USD returned to the bottom of an all-too-familiar range.
Popular trader Skew noted manipulatory liquidity moves on exchanges via order “spoofing,” the latest case of which provided overhead resistance which was added and removed multiple times.
Spot demand on largest global exchange Binance, he added on the day, was at $60,000 “and lower.”
Others noted that Bitcoin had filled the latest “gap” in CME futures, which appeared thanks to the weekend’s upside.
For Charles Edwards, founder of quantitative Bitcoin and digital asset fund Capriole Investments, the latest BTC price action was cause for concern.
Markets, he argued, had not reconciled themselves with the ongoing capitulation phase among miners — a phenomenon recently reported on by Cointelegraph.
“Price has not yet reflected the onchain obliteration,” he warned X followers.
“It doesn't have to happen, time also heals all wounds, but Bitcoin is not patient. Either we're lucky, and price just consolidates between $60-70K for up to 2 months, or we puke and get a healthy overdue correction.”
