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Bitcoin holds steady as key catalysts aim to surpass the $110,000 mark.
Since Wednesday, the price of Bitcoin has been maintaining within a narrow trading range, marking six consecutive days with price volatility below 3%. This unusual low volatility has led traders to question whether a breakout could be influenced by the weakening of the US dollar, especially in the context of the deteriorating financial situation in America.
Although the movement of the US dollar is attracting attention, it still requires the synchronization of many important factors for Bitcoin to reach the milestone of 110,000 USD.
Will Bitcoin benefit from inflation and capital rotation?
Many investors still view Bitcoin as a riskier asset rather than a completely uncorrelated financial option. With the Nasdaq 100 reaching a record high on June 30, investor confidence is rising, encouraging some to shift from fixed assets to higher-risk assets, including Bitcoin.
Another potential factor that could drive Bitcoin above $110,000 is the re-emergence of inflationary pressure. The Personal Consumption Expenditures Price Index in America has remained below 2.3% from March to May, after a five-month period of inflation exceeding the Federal Reserve's target.
Whether the correlation of Bitcoin with consumer prices holds or not, this cryptocurrency has long been promoted as a hedge against inflation, especially during the price surge in 2021. Bitcoin is often likened to digital gold, but the 114% increase in 2024 suggests that price surges can occur even in a low-inflation environment.
Although not directly related to Bitcoin, the ability to add Strategy (MSTR) to the S&P 500 is considered by some analysts to be a secondary driving factor. Joe Burnett, Director at Semler Scientific, remarked that "if included, a wave of passive capital will begin to chase Bitcoin."
Finally, the ability of Bitcoin to surpass the 110,000 USD mark could be driven by several factors: stronger risk appetite following record highs in the stock market, concerns about recovering inflation, and the potential inclusion of Strategy into the S&P 500—all of which could converge to create favorable momentum for BTC prices.
Mr. Giáo