In the first half of 2023, cryptocurrency prices exhibited mixed dynamics, with Bitcoin reaching record levels while most altcoins experienced double-digit losses. The main reasons behind this behavior are tied to economic policy and investor expectations.
Bitcoin Breakout and Market Impact
One of the key factors that could ignite a bull market is the expected price movement of Bitcoin, which has formed a large cup-and-handle pattern on the daily chart. If a breakout occurs, the price could soar to over $140,000. A bullish flag pattern has also been identified, indicating a potential strong breakout.
Federal Reserve Interest Rate Cuts
Another potential catalyst for the next crypto bull run may come from the Federal Reserve, which is expected to start cutting rates later this year. Economists project that the Fed may initiate easing in September. Rate cuts are often associated with increased attractiveness of risky assets, including cryptocurrencies.
ETF Approvals and Rising US Money Supply
Proposed ETF approvals by the Securities and Exchange Commission could also become a significant driver for further growth in the cryptocurrency market. Investors anticipate the approval of major ETFs, which could lead to substantial capital inflows. Meanwhile, the rising US money supply, which has hit a record of $21.8 trillion, may positively influence cryptocurrency price dynamics.
The second half of 2023 could be pivotal for the cryptocurrency market due to several factors, including Bitcoin price movements, changes in the Federal Reserve's policy, ETF approvals, and the increase in money supply in the country.
