China-US deal could push Bitcoin to $120,000
Financial markets are entering a crucial week, where the outcome of US-China talks could determine the direction of the global economy and provide momentum for cryptocurrencies.
Anticipation of a Fed rate cut and the upcoming meeting between Donald Trump and Xi Jinping create conditions for Bitcoin to strengthen above $120,000, according to a Coin22 analyst's forecast in a new report.
The US and China are nearing a trade agreement.
Two days of talks over the weekend culminated in preliminary agreements between Washington and Beijing. The United States expressed its willingness to lift all tariffs on Chinese imports if the two countries' leaders approved the terms. In return, China agreed to defer its rare earth metal export restrictions for a year. Markets interpreted this as a sign of easing tensions and increasing optimism.
Investors see the talks as the beginning of a shift from confrontation to pragmatic dialogue. However, disagreements remain on key issues. The US continues to pressure China over access to technology, while Beijing refuses to loosen its grip on the tech sector. Meanwhile, Trump is seeking to showcase his foreign policy success ahead of the Senate elections, adding a political dimension to the process.
Taiwan's geopolitical risk also remains, potentially destroying all agreements if the US steps up its military support for the island.
The market is expecting a Fed rate cut.
The Federal Reserve will meet before the US-China summit. The likelihood of a key rate cut has reached almost 100%. An analyst believes such a move will lead to increased global liquidity and heightened interest in risky assets, including cryptocurrencies.
Historically, the dynamics of the M2 money supply coincide with Bitcoin's price movement. When liquidity increases, the crypto market gains momentum. If central banks begin to ease monetary conditions, Bitcoin may be the first to reflect this trend.
Capital is moving from gold to Bitcoin.
Gold has fallen below $4,000 per ounce, and investors have begun taking profits en masse. Funds are shifting to higher-yielding assets, including digital currencies.
The analyst called gold's decline a sign of a changing era. Bitcoin is becoming a new form of value store, free from physical storage, insurance, and political risk. Large funds are seeking liquidity and mobility, and digital assets are meeting these needs.
The cryptocurrency market is emerging from its fear phase.
Following the October crash, the Fear and Greed Index rose from 24 to 51. Panic subsided, and the market entered a stabilization phase.
Over the past month, exchanges have received over $6.5 billion in stablecoins, $3.6 billion of which went to Binance. The analyst notes that such inflows often herald active buying. Capital flows to exchanges during downturns, indicating that major players are preparing for new deals.
Bitcoin strengthens in uptrend
The Bitcoin price continues to move smoothly. The market is maturing: large funds are building positions through gradual accumulation rather than short-term surges.
The current growth is occurring in stages, with each correction becoming shorter than the previous one and support levels rising. This type of movement is forming a sustainable bullish trend and laying the foundation for long-term growth.
The week that will decide the fate of the market
The outcome of US-China negotiations and the Fed's rate decision will determine whether Bitcoin will maintain its smooth upward trend or return to high volatility. If the parties sign a trade agreement and the rate is lowered, liquidity will increase, and cryptocurrencies will gain new momentum.
Source: cryptonews.net
