Market analysts see Bitcoin testing $120,000 level
Bitcoin appears poised to test the $120,000 level in the near future, according to market analysts who point to improving technical conditions and continued risk appetite following recent Federal Reserve developments. The cryptocurrency market is currently processing the implications of the Fed’s first interest rate cut after a nine-month pause, with analysts suggesting it might take about a week for markets to fully absorb these changes.
Yuya Hasegawa, an analyst at Japanese cryptocurrency exchange Bitbank, noted that the improved technical outlook combined with sustained risk appetite creates additional support for Bitcoin’s price movement. “This puts the $120,000 test within reach,” Hasegawa stated, though he cautioned that markets might see a full reversal pattern emerge following any successful breakout above current levels.
Federal Reserve guidance remains crucial
Market participants are closely watching upcoming statements from Federal Reserve officials, particularly Chair Jerome Powell and Vice Chair for Supervision Michelle W. Bowman. The Federal Open Market Committee’s updated projections indicate the possibility of two additional interest rate cuts in 2025, though Powell has avoided making firm commitments on the timing or extent of future monetary policy adjustments.
Hasegawa identified a strong US dollar and weak bond markets with rising yields as the primary near-term risks for Bitcoin. However, he suggested these factors represent short-term market reactions rather than sustained trends, possibly resulting from markets pricing in overly aggressive expectations for rate cuts in the coming year.
Options market activity suggests tempered expectations
Meanwhile, in the derivatives market, Jake Ostrovskis, head of OTC trading at Wintermute, observed that options traders are predominantly selling premiums and establishing upward limits on Bitcoin’s price movement. Trading activity appears driven by call spread selling in the $125,000 to $150,000 range, which suggests that investors don’t expect Bitcoin to break significantly beyond these levels in the immediate future.
This options market activity creates an interesting dynamic where while analysts see potential for Bitcoin to reach $120,000, derivatives traders appear to be positioning for more moderate gains. The discrepancy between spot market analysis and derivatives positioning might reflect different time horizons or risk management approaches among market participants.
The coming week will likely provide clearer signals as markets digest the full implications of the Fed’s policy shift and how it might influence cryptocurrency valuations amid broader macroeconomic conditions.
