Countdown to the Bank of Japan's rate hike! BTC is fluctuating around 115080, the key life-and-death line; historical patterns reveal the truth.
On July 25, global financial markets were abuzz with a heavyweight announcement — U.S. President Trump announced a 'massive' trade agreement with Japan, reducing tariffs on Japanese exports to the U.S. from 25% to 15%, and committing to invest $550 billion in the U.S. This agreement not only caused the Nikkei 225 index to soar by 3.7% in a single day but also sparked limitless speculation about a shift in the Bank of Japan's monetary policy. As cryptocurrency investors, what we care most about is: if the Bank of Japan accelerates rate hikes as a result, what impact will that have on BTC and other cryptocurrencies?
The trade agreement has been finalized, and expectations for the Bank of Japan's rate hike are heating up.
According to the agreement, Japan is opening its market to the U.S. in key areas such as automobiles and rice, while reducing tariffs on exports to the U.S. from 25% to 15%. Although there is controversy over agricultural openness in Japan, the market generally believes that this agreement alleviates the pressure on Japanese exporting companies, especially in the automobile industry. Japan's Economic Revitalization Minister, Akira Amari, stated that the agreement will 'create hundreds of thousands of jobs,' while Prime Minister Shigeru Ishiba referred to it as 'the minimum tariff agreement reached with a country that has a trade surplus with the U.S.'
However, Nomura Research Institute economist Nobuhide Nakanishi threw cold water on the situation: the agreement could lead to a 0.55% decline in Japan's GDP within a year. He warned that if the U.S. continues to pursue 'America First' policies, Japanese companies might slow their investments in the U.S. and turn to the European market. This uncertainty provides space for the Bank of Japan's policy adjustments.
Just the day after the trade agreement was reached, ING economist Min Joo Kang pointed out: Although inflation in Tokyo fell in July, core inflation remains high enough to support the normalization of the Bank of Japan's policy. The market generally expects that the Bank of Japan will remain steady at next week’s meeting, but will raise inflation forecasts in the future, with no change in the rate hike path.
Technical Analysis: BTC is experiencing fluctuations and consolidation, with 115080 being the key support level.
Based on the latest daily BTC candlestick chart, the current price is in a fluctuating trend, with the key support level around 115080 and the resistance level at 120282.3. The chart does not show obvious typical technical patterns, such as head and shoulders or double bottom; the price movement mainly exhibits fluctuations without forming clear trend patterns.
In terms of trading volume, the histogram has fluctuated within the consolidation area, but overall there has not been a significant increase or decrease in volume, indicating cautious market sentiment and low capital participation. The moving average system shows an intertwining state of bulls and bears, with the 5-day, 10-day, and 20-day moving averages entwined, lacking clear directional guidance, further confirming the current market's consolidation pattern.
What is the impact of Japan's rate hikes on BTC?
Reviewing the market reaction when the Bank of Japan raised rates by 25 basis points to 0.5% at the beginning of 2025, BTC's price did not show a unilateral decline but rather a 'first suppression and then rise' trend. Analysts believe that Japan's crypto market regulation is relatively mature, individual investors are active, and BTC, as a global asset, is influenced by multiple factors.
In the current market environment, the short-term pressure of Japan's rate hikes on BTC may be concentrated on:
Capital diversion: The increase in traditional asset yields in Japan may attract some retail funds back.
Sentiment transmission: If major global central banks (such as the Federal Reserve) tighten policies simultaneously, the decline in market risk appetite may spill over into the crypto market.
However, in the long run, the maturity of Japan's crypto market and BTC's 'digital gold' properties may make it one of the options for capital hedging. Especially in times of increasing global economic uncertainty, the low correlation of BTC with traditional markets may attract more institutional allocations.
Rate hikes are both a challenge and an opportunity.
Cryptocurrency analyst Amit Kukreja pointed out: 'There’s nothing alarming about Japan raising interest rates; the market has already anticipated it, and short positions on the yen peaked in July, leading investors to adjust their strategies in advance.'
André Dragosch, Head of Research at Bitwise Europe, emphasized: 'When sovereign bond yields soar, reflecting the market's concerns about fiscal sustainability, Bitcoin, as an asset with no counterparty risk, may become a powerful tool for hedging sovereign default risks, and could even surge to $200,000.'
Hold the support level, and wait for directional choices.
In light of the possible rate hikes by the Bank of Japan, investors in the crypto space should pay attention to two major signals:
The Bank of Japan's actual actions: If the August meeting signals a clear rate hike, short-term market volatility may increase, but the magnitude of the rate hike and subsequent policy path need to be observed.
Global monetary policy coordination: If Japan acts 'alone' while the Federal Reserve maintains an accommodative stance, the impact on the crypto market will be limited; if the world enters a tightening cycle, BTC may face greater pressure.
For ordinary retail investors, in the current market environment, it is recommended to maintain a strategy of 'core holdings + flexible positions': on one hand, have a long-term positive outlook on BTC's value storage function; on the other hand, reduce short-term volatility risks through phased accumulation and hedging tools.
Personal Opinion
Currently, BTC is standing at the key support level of 115080, which is not only a technical defense line but also an indicator of market confidence. Regardless of short-term fluctuations, the long-term value of BTC as 'digital gold' is being recognized by more and more capital. If the 115080 support level holds, it could rise towards 116000; if it breaks below 115080, then consider a drop towards 114000. For specific support and resistance levels, pay attention to the introduction section!
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