Any earlier-than-expected rate cuts by the Federal Reserve (Fed) could trigger a strong rally in Bitcoin, bringing this leading currency back to the psychological high of $112,000.

The crypto market is closely monitoring U.S. monetary policy, and an unexpected rate cut by the Fed would have profound implications for the prices of Bitcoin and many other cryptocurrencies.

If the next two rate cuts occur much earlier than the market expects, it will have a significant impact on price movements, especially for Bitcoin and some other digital assets.

Target $112,000—an important psychological threshold.

Data shows that Bitcoin reached a new high of $111,970 on May 22, and as of the time of publication, it has slightly retreated to $103,574. However, $112,000 remains a bullish target for many traders—this level holds significant psychological and technical importance.

A sufficiently strong catalyst, such as a rate cut or improved risk sentiment, is needed for Bitcoin to break through $112,000 and establish a higher price range.

According to the CME FedWatch tool, the likelihood that the Federal Reserve will keep interest rates unchanged at 4.25% to 4.5% during the policy meeting on June 18 is 97.5%. However, the Fed has already gathered 'sufficient data' to begin adjusting interest rates, but still faces unpredictable variables, especially those stemming from U.S. trade policy.

Trump's tariffs and trade policies remain a significant unknown. The Fed needs to have a clearer understanding of the impacts of these policies before taking action.

The U.S. International Trade Court recently blocked Trump's attempt to impose tariffs, stating that it exceeded his authority. However, the appeals court later allowed the policy to proceed, and Trump doubled the tariffs on imported steel and aluminum to 50%—this move could exacerbate inflationary pressures and influence the Fed's monetary policy path.

Recently, some signs of weakness in the U.S. economy have been observed, and a strong employment report may be the reason the Fed pauses any easing policies, which could limit Bitcoin's upside potential in the short term.

Today's fear index is 52, slightly rebounding but still in a neutral state.

There isn't much to say about the market, with short-term fluctuations and no obvious catalysts. Additionally, liquidity is low over the weekend, so it's best to hold onto the current assets. Those who bought Bitcoin at 100,000 and Ethereum at 2,400 should hold on for now. Last night's non-farm payroll data was very bright, and currently, the U.S. is facing both internal and external issues, with recession signs becoming increasingly evident, which may stimulate the Fed to cut rates, indirectly benefiting the market. Moreover, we see news every day about listed companies entering the Bitcoin market, with both familiar and new faces, and continuous buying pressure, so there's no need to be afraid.

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