Will Rate Cuts and a Weak Dollar Drive BTC to a New All-Time High of $116,000?

The reigning cryptocurrency is breaking barriers, and the market is buzzing with anticipation of monetary policy changes.

The crypto world is in turmoil. Bitcoin (BTC), the leading cryptocurrency, made history again by reaching a new all-time high of $116,401.07, posting significant gains of 3.44% at the time of this report. This impressive rise comes amid intense speculation about possible interest rate cuts by the U.S. Federal Reserve (Fed), coupled with a weakening dollar and the constant flow of capital into Bitcoin ETFs.

The cryptocurrency broke through a key resistance level in the $112,000 area, a level that has held the price back since May 22. TradingView

What's Driving Bitcoin's Rocket?

Bitcoin's recent rally is no coincidence; several macroeconomic and technical factors have aligned to catapult its price. Expectations that the Federal Reserve will ease its monetary policy have been a key catalyst. Following the Federal Open Market Committee (FOMC) meeting on June 20, Christopher Waller, a member of the Fed's Board of Governors, expressed his willingness to consider a rate cut at the next meeting. Waller argued that action should not be waited for a labor market collapse, despite its current strength, pointing to signs of stress such as high unemployment among recent graduates.

According to Waller, the Fed has maintained a six-month pause without an "inflationary shock," which, in his view, opens the door to cutting rates to assess their impact on inflation later.

Record-High ETFs and a Turbulent Dollar

Meanwhile, the steady flow of capital into spot Bitcoin ETFs has been monumental. The market capitalization of these instruments reached an all-time high of $142 billion, demonstrating the growing institutional and retail adoption of Bitcoin as a legitimate asset class.

Furthermore, the weakness of the US dollar, driven in part by the tariff war initiated by Donald Trump and interest rate expectations, has diverted capital toward alternative assets such as Bitcoin, which acts as a digital store of value.

The Breakout That Changed Everything

From a technical perspective, Bitcoin is exhibiting remarkable strength. The cryptocurrency broke above a key resistance level in the $112,000 area, a level that has held the price back since May 22. This breakout occurred after the formation of a bearish channel, which, when pierced by high trading volume, is considered a powerful bullish signal by analysts. The upward movement has been similar in size to the bearish channel, confirming the strength of the momentum. Bitcoin is currently trading above the 50- and 200-period exponential moving averages (EMA50 and EMA200), reinforcing the confirmation of a bull market.

The combination of favorable macroeconomic factors, exponential ETF growth, and a solid technical setup position Bitcoin at a peak moment. The crypto community is closely watching to see whether this bullish trend will continue, once again redefining the global financial landscape.

Disclaimer: This article is for informational and educational purposes only and should not be considered financial advice. Investing in cryptocurrencies involves significant risks, including total loss of principal. Please conduct your own research and consult a financial professional before making any investment decisions.