Daily Crypto Signals: Bitcoin Eyes $137K, Ethereum Hits New Highs Amid Fed Rate Cut Speculation
Bitcoin traders are setting ambitious price targets of $137,000 as cooling US inflation data boosts Federal Reserve rate cut odds to 94%
Quick overview
- Bitcoin traders are targeting a price of $137,000 as cooling US inflation raises the odds of a Federal Reserve rate cut to 94%.
- Ethereum has surged past $4,500, with futures open interest reaching an all-time high of $60.8 billion, indicating strong institutional demand.
- Despite the price increases, concerns about Ethereum's fundamentals persist, as major companies develop their own layer-1 blockchains.
- Several altcoins, including BNB and Chainlink, are showing potential for breakouts, influenced by Bitcoin's market performance and Federal Reserve policy.
Bitcoin BTC/USD traders are setting ambitious price targets of $137,000 as cooling US inflation data boosts Federal Reserve rate cut odds to 94%, while Ethereum ETH/USD surges past $4,500 with futures open interest reaching all-time highs. The crypto market faces mixed signals as institutional demand grows but underlying fundamentals show signs of weakness.
Crypto Market Developments
This week, the cryptocurrency market was very unstable with the release of July’s Consumer Price Index (CPI) data, which indicated that inflation was still at 2.7% year-over-year. This news has raised hopes for a Federal Reserve rate cut in September to 93.9%, which is good news for risk assets like cryptocurrencies.
The current market is being shaped by a number of important events. Do Kwon, one of the founders of Terraform Labs, pled guilty to wire fraud and conspiracy charges. He agreed to pay $19 million in fines and might spend up to 12 years in jail. Circle also said that its layer-1 blockchain Arc, which is made just for stablecoin finance, will be available soon. The company also said that its revenue for the second quarter rose by 53% to $658 million.
The market also got a little better after Ethereum core engineer Federico Carrone was released after being held in Turkey for 24 hours on suspicion of being linked to crypto mixer protocols. These incidents show how both regulatory issues and changes in institutions are affecting the crypto industry right now.
Bitcoin Price Prediction: $137,000 Next Target?
Bitcoin’s price changes are still very much affected by macroeconomic issues, especially the Federal Reserve’s monetary policy. The July CPI data, which showed inflation at 2.7% year-over-year, below the 2.8% expectation, has made the case for lowering interest rates stronger. Core CPI was up 3.1% from last year, which was what people expected. Monthly CPI, on the other hand, only went up 0.2%, down from 0.3% in June. This information supports a slightly positive outlook for Bitcoin, as lower interest rates make holding the cryptocurrency less costly and may bring in new money to the market.
After the CPI came out, Bitcoin shot up to $122,190 on Monday, but then fell 3% to $118,500, missing the chance to close above the important $120,000 psychological mark for the day. Technical experts are looking at big goals, with some predicting $137,000 based on breakouts of falling trendlines. The bullish flag pattern on the daily chart has broken to the upside. The recent retreat could be a retest before the price moves toward the main goal of $130,000. But if it doesn’t go back over $120,000, it could face short-term downward pressure. Key support is between $117,650 and $115,650, which is where a CME gap opened over the weekend.
Ethereum Crosses $4,500
Ethereum has shown incredible power, rising beyond $4,500 to $4,518 on Tuesday as traders became more willing to take risks after the mild inflation figures. The total open interest in ETH futures reached an all-time high of $60.8 billion, up from $47 billion a week earlier. However, most of this rise is due to rising prices rather than new leveraged bets. According to Farside Investors’ data, spot Ethereum ETFs saw their greatest net inflows ever on Monday, with $1.01 billion coming in. This shows that there is strong institutional demand for the cryptocurrency.
Even though the price has gone up a lot, derivatives data shows some worrying trends that aren’t obvious. The annualized premium for ETH perpetual futures is 11%, which is neutral. The 30-day futures premium, on the other hand, dropped from 11% to 8% on Tuesday. It is interesting that there aren’t any aggressive leveraged positions given that the price has gone up 32% in the last 10 days.
This could mean that people are worried about Ethereum’s fundamentals. One thing that makes these worries worse is that big companies like Stripe, Circle, Tether, and JPMorgan have developed their own layer-1 blockchains instead of using Ethereum layer-2 solutions. Also, Ethereum’s total value locked (TVL) fell 7% in the last 30 days to 23.3 million ETH. Weekly base layer fees were just $7.5 million, which is less than what Solana ($9.6 million) and Tron ($14.3 million) made.
Top Altcoins to Watch Today
Several altcoins are positioning for potential breakouts as the broader market shows strength.
- BNB BNB/USD has been consolidating between $792 and $827 for three days, with a break above $827 potentially targeting $861 and eventually $900. The token remains supported by upsloping moving averages, though bears will look to defend the $861 resistance level.
- Chainlink LINK/USD has gained significant momentum after breaking above $18 resistance, surging past $22.70 on Tuesday. The bullish momentum could extend toward $27 and potentially $30, though bears are expected to mount strong defense at these levels. The token benefits from buying on every minor dip, with key support at the breakout level of $22.70.
- Uniswap UNI/USD bounced strongly from the 50-day SMA at $9.05, currently facing resistance at $12. A successful break above this level could trigger a surge toward $15, while failure might result in a retest of the 20-day SMA at $10.19. The token’s ability to hold above the 50-day SMA will be crucial for maintaining its bullish trajectory.
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