Bitcoin Holds $107K As Stagflation, Fed Rate Cuts Loom
Bitcoin has reclaimed $107,000 after briefly dipping below $99,000, but the rally lacks retail investor enthusiasm, driven mainly by funds and traders. Onchain activity remains subdued, raising concerns about the sustainability of this rally amid signs of a weakening US economy. The Federal Reserve faces challenges balancing inflation control with economic support, with stagflation concerns growing. GDP forecasts have been reduced, and inflation projections increased, while consumer demand appears weak. Tariff tensions continue, with potential new tariffs on imports looming. Bitcoin's market lacks broad conviction, with exchange inflows significantly lower than during previous bull markets. Long-term holders are accumulating, suggesting a potential upward reversal in the coming weeks. Historical data indicates summer typically sees lower Bitcoin performance, implying a consolidation phase ahead. Future price movements may depend on economic data and the Fed's actions regarding interest rates. A breakout to new highs will require increased demand and market activity.
