Bitcoin price crumbles to $62K support, but derivatives metrics show bullish signs
Bitcoin’s price continues to correct, but BTC options markets reflect traders’ interest in the $62,000 level.
Bitcoin (BTC) price plunged 5.5% between July 31 and Aug. 1, reaching its lowest level in over two weeks at $62,498. This movement has been attributed to reduced expectations of interest rate cuts in the United States and the distribution of 47,000 BTC from the estate of defunct exchange Mt. Gox. Traders fear that Bitcoin’s price could further correct to retest the $57,000 support level, but derivatives markets show resilience and no signs of stress.
On July 31, the United States Federal Open Market Committee announced its decision to leave interest rates unchanged at 5.25%, aligning with market expectations. Fed Chair Jerome Powell cited solid signs of gross domestic product expansion and confidence in the current rate of inflation reduction, potentially supporting a rate cut in September. In short, Powell’s statement suggests a more cautious approach to rate cuts.
Investors increased their bets in US Treasurys, causing the five-year yield to reach its lowest level in six months. Part of this movement can be explained by escalating tensions in the Middle East, leading traders to seek protection in the asset deemed safest. Another confirmation of this theory comes from the precious metal gold, as its price increased to $2,450, just 1.5% below its all-time high.
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Author: Marcel Pechman
