Powell pushes Bitcoin temporarily below 100,000 Euro

Bitcoin dropped just below €100,000 at the end of the week (for the first time in a long time), a key psychological barrier. The falling prices are either a consequence of crypto portfolio diversification (investors believe other cryptocurrencies will rise faster and therefore exchange some of their Bitcoins for XRP, Solana, or Ether) or a consequence of waning hopes of an imminent US interest rate cut.

Federal Reserve

Higher-than-expected US labor market data on Thursday dampened hopes for rate cuts by the Federal Reserve. It also ended a seven-day rally in Asian stocks. The White House has been trying to change the Fed’s mind for a long time, of course.

By now, Federal Reserve Chairman Jay Powell and President Donald Trump have been feuding for weeks, as Powell steadfastly refuses to lower interest rates, something Trump is desperate to do given his declining popularity. Lower interest rates could boost stock (and cryptocurrency) markets, giving the news cycle something new to focus on.

Earlier this week, Bitcoin hit a record price after optimism about the US President’s crypto-friendly policies reached unprecedented levels. However, now that Congress has begun its summer recess, crypto needs to look for new stimulus, which it’s currently not finding hence the largest digital currency remains without another new ATH.

Nevertheless, crypto investors remain very positive. According to Bitfinex’s latest research report, the $136,000 level is the next target for Bitcoin. At the time of writing, the largest digital currency is trading at $119,100.