Bitcoin (BTC) has made a remarkable surge above $114k for the first time in over two years on Wednesday, September 10. This significant milestone comes after the flagship coin broke through a key midterm resistance level around $113.5k during the mid-New York session, following three unsuccessful attempts in the past fortnight.
The entire altcoin market has also experienced a surge, with Binance Coin (BNB) and Solana (SOL) leading the way. This collective rally has propelled the total cryptocurrency market cap back above $4 trillion.
Bitcoin Price Edges Higher on Rising Odds of Fed Rate Cuts
The crypto market’s upward momentum on Wednesday can be attributed to the release of August PPI inflation data, which revealed a decrease to 2.6%, falling below the expected 3.3%. Additionally, the Core PPI dropped to 2.8%, below the market expectations of 3.5%, thereby increasing the likelihood of a Fed rate cut next week.
Data from Kalshi indicates that there is an 80% probability of a 25 bps Fed rate cut, with an 18% chance of a rate cut greater than 25bps. Traders on Kalshi are projecting a 44% chance of 3 rate cuts, surpassing the 39% probability of 2 rate cuts for the first time since April.
Wells Fargo on Fed Rate Cuts
Analysts at Wells Fargo are anticipating that the Federal Reserve will implement five 25 bps rate cuts by mid-2026. The bank forecasts that the Fed will reduce its benchmark interest rates to 3.5% and 3.75% by the end of this year. President Donald Trump has also called on Fed Chair Jerome Powell to make significant rate cuts during the upcoming meeting, citing a weakening labor market and low inflation as favorable conditions for boosting the economy.
What’s Next for Crypto?
If the Fed proceeds with a rate cut next week, the crypto market is poised to experience a surge in bullish sentiment. The demand for risky assets is expected to rise alongside the expanding global money supply in the fourth quarter.
Moreover, the recent breakout and rally of Gold price to a new all-time high above $3,670 per ounce signals positive momentum for Bitcoin. With Bitcoin’s price hovering around the resistance level of $120k, a consistent close above this level could pave the way for a rally towards a new all-time high.