Bitcoin targeted $68,000 at the Wall Street open on July 22, spurred by bullish events, including a significant interest rate cut by China.
China Enacts “Unexpected” Rate Cuts
Data from TradingView indicated BTC price aiming for range highs after briefly dipping below $67,000 earlier in the day. The price rebound coincided with mixed performances in Asian stocks as the People’s Bank of China (PBOC) cut key interest rates, surprising markets.
The PBOC reduced the seven-day reverse repo rate by 0.1% to 1.7%, alongside cuts to the one-year and five-year loan prime rates (LPR), according to Reuters. Larry Hu, chief China economist at Macquarie Group, suggested the unexpected cuts were due to a sharp slowdown in growth momentum in Q2 and the target to achieve this year’s growth goals by the third plenum.
BTC/USD 1-hour chart. Source: TradingView
Market commentator Holger Zchaepitz noted it had been nearly a year since the last Chinese rate cut, commenting that the Chinese stock market showed little enthusiasm.
Global interest rate cuts are crucial for the performance of risk assets, including cryptocurrencies. While China and Europe have begun rate-cut cycles, the US is expected to start in September.
Bitcoin Approaches Key Resistance
Bitcoin faced its last cluster of resistance before all-time highs, particularly the $69,000 level, which has been significant since late 2021.
“Bitcoin has canceled out almost the entirety of the -25.6% retrace,” noted popular trader and analyst Rekt Capital. “It took two weeks to almost fully cancel out a five-week retrace.”
Central bank interest rate expectations. Source: TXMC Trades/X
Rekt Capital’s chart compared recent BTC price behavior to other retracements during the bull market, highlighting the latest as the deepest in the current uptrend. They suggested any dips to retest $65,000 would be typical, generally leading to an upside towards $71,500.
BTC/USD comparison. Source: Rekt Capital/X
The analyst reiterated the possibility of new all-time highs by September, at the latest. Michaël van de Poppe, founder and CEO of trading firm MNTrading, also highlighted the importance of $65,000 as support, with range lows at around $61,000 being the next line of defense. Van de Poppe predicted that maintaining these levels would facilitate a continuation towards the all-time high.
BTC/USDT chart. Source: Michaël van de Poppe/X
In summary, Bitcoin’s recent performance and China’s unexpected rate cuts have generated optimism, with analysts predicting potential new all-time highs within the next two months.
