Bitcoin Rises to $82,851 After Waller's Fed Signal
Waller cooled rate expectations, after which shorts were squeezed hard and Bitcoin ETFs also saw inflows again. Investors are now watching the 50-week moving average around $81,000.
Key Takeaways
- Bitcoin rose from $77,500 to $82,851 on Thursday after a less hawkish rate comment from Fed Governor Christopher Waller.
- The move wiped out more than $510 million in positions, including $415 million in shorts.
- Analysts are now watching the 50-week moving average around $81,000 and the $82,814 level in the short term.
Bitcoin jumped on Thursday from $77,500 (€66,700) to $82,851 (€71,300) after Fed Governor Christopher Waller said he likely wants to keep rates unchanged in September. That quickly gave the crypto market fresh momentum and pushed total value up to $2.73 trillion (€2.3 trillion). The question now is whether Bitcoin can hold this level through the weekend.
Fed Signal Sets the Tone
Waller said on September 3 that rates can stay at the current level as long as inflation keeps moving toward 2 percent. Investors read that as a less hawkish tone from the Fed. Bitcoin rose 4.36 percent within hours and hit its highest level since May.
Market expectations also shifted quickly. According to CME Group's FedWatch tool, the odds of a rate hike during the September 15 and 16 meeting fell from 63.2 percent to 50.4 percent. A rate cut is still far off, but the Fed's tone still matters a lot for risk assets.
Shorts Got Squeezed
The sharp move higher triggered a major short squeeze. In total, more than $510 million (€439 million) in positions were wiped out, including $415 million (€357 million) in shorts. That means many traders who were betting on a drop had to close their positions by buying Bitcoin back.
Those forced buys pushed the rally even further. At the same time, Bitcoin ETFs also turned green. On September 2, $101.15 million (€87 million) flowed into Bitcoin ETFs, while Ethereum saw $48.08 million (€41.4 million) leave. That fits the picture of the price once again testing how strong the zone around the May high really is. In a recent analysis, that level was also mentioned as an important point for a convincing breakout: the May high.
What Matters This Weekend
For European crypto readers, the upcoming weekly close is especially important. Bitcoin is now just above the 50-week moving average around $81,000 (€69,700), a level the price has often fallen back to before. Analysts are also watching $82,814 (€71,300) as an important short-term level.
If Bitcoin stays above $81,000 (€69,700), the new week starts from a stronger base. If the price drops below that, the zone around $77,500 (€66,700) comes back into view. The Fed meeting on September 15 and 16 also remains an important moment for the crypto market, because new rate expectations can quickly affect sentiment around Bitcoin and other tokens.
