Bitcoin and Ether continue to fluctuate in the markets as traders await important news regarding interest rates and inflation that could affect future price dynamics.
Market Situation
After hitting record highs in August, Bitcoin has spent nearly two weeks hovering around $110,000, while Ether is trading between $4,300 and $4,500. Derivatives desks report increased demand for protective puts, indicating traders' desire for insurance in case inflation surprises.
Bitcoin and Ether Dynamics
Markets are pricing in a September rate cut as virtually certain, though there is a small but rising chance of a half-point move. This has pushed implied volatility higher, with analysts at Derive noting that much of the excitement may come later in the year. Their gauges suggest Bitcoin has a 23% shot at hitting $140,000 by December, with Ether having the same odds of breaking $7,000.
Outlook and Seasonal Trends
Analysts at Bitfinex highlight that the fourth quarter has historically been Bitcoin’s strongest period, with October and November leading to price rallies. If the Fed confirms a dovish path and Treasury supply remains orderly, they argue conditions are in place for history to repeat itself.
Trader expectations regarding news on interest rates and inflation continue to influence the cryptocurrency market, while historical trends create prospects for price increases in Bitcoin and Ether during the fourth quarter.
