Bitcoin Holds Steady at 110,000 as Fed Rate Cut Looms

Bitcoin has been trading in a narrow range around 110,000 dollars, reflecting a subdued market sentiment as investors await the highly anticipated Federal Reserve interest rate decision next week. The price of Bitcoin has shown resilience despite the U.S. adding only 22,000 jobs in August, far below the expected 75,000. This weaker-than-expected data suggests a potential slowdown in the U.S. economy, which could provide the Federal Reserve with more reasons to consider a rate cut.

As the Federal Reserve's interest rate decision on September 17 approaches, market expectations are leaning heavily towards a rate cut. The probability of a rate cut is at 100%, with a 25 basis point cut being the most anticipated outcome. However, there is a 10% chance that the Federal Reserve may opt for a more aggressive 50 basis point cut.

Analysts have noted that while the weaker employment report has increased market expectations for a dovish stance from the Federal Reserve, which is typically beneficial for risk assets like Bitcoin, the market has already priced in some of these expectations. Additionally, institutional profit-taking and relatively stable ETF inflows are limiting Bitcoin's upward momentum, keeping it within a tight trading range.

Even if the Federal Reserve decides to cut rates, Bitcoin's price may remain subdued. The rate cut could signal a weakening U.S. economy, and persistent inflation along with cautious risk sentiment could cap risk appetite. Without stronger ETF inflows or significant liquidity expansion, Bitcoin may struggle to break above 120,000 dollars.