Trump pressures the Federal Reserve to cut rates to 1%! Can BTC break out of its consolidation? Technical analysis reveals three key signals.
'High interest rates are choking the U.S. economy!' Recently, Trump again 'attacked' the Federal Reserve, demanding rates be drastically cut to 1%. This game between the White House and the Fed not only stirs the global financial market but also leaves cryptocurrency investors waiting with bated breath—can BTC leverage the favorable winds of rate cuts to break the consolidation? Based on the latest candlestick charts and policy movements, this article dissects the key signals!
First, Trump's 'interest rate war' escalates: Can a 1% rate cut become reality?
Recently, Trump pressured Federal Reserve Chairman Powell through a handwritten letter, stating 'high interest rates have cost the U.S. hundreds of billions' and demanding rates be cut to 1%. This statement continues his 'interventionist' approach since taking office in 2024, with the core demand being to stimulate the economy and alleviate trade disadvantages.
Market response:
The Federal Reserve's stance is firm: Powell emphasized a 'data-driven' approach in the June meeting. Despite inflation dropping to 2.3% (April data), core PCE remains at 2.6%, far from a reasonable range for rate cuts. The dot plot indicates only two 25 basis point cuts by 2025, contrasting with Trump's aggressive demands.
Expectations for rate cuts are heating up: Traders are betting on a first rate cut in September, but Powell's 'cautious rate cut' statement has caused market divisions. If Trump continues to apply pressure, it may accelerate discussions within the Federal Reserve regarding rate cuts.
Second, technical analysis of BTC: Three key signals in the consolidation.
According to the latest candlestick chart, BTC is currently fluctuating within the range of 116780-119000, with three major technical characteristics:
Key position competition:
Support level 116780: The market has tested this level multiple times without breaking it, indicating strong buying interest below. If the expectations for rate cuts strengthen, this position may become the starting point for a rebound.
Resistance level 119000: The market has attempted to break this level unsuccessfully three times recently; a breakthrough requires accompanying trading volume. If the Federal Reserve signals a clear intention to cut rates, it may trigger a bullish breakout.
Volume trap:
Trading volume has not significantly increased, indicating a strong wait-and-see sentiment in the market. If a rate cut occurs, be wary of 'buy the expectation, sell the fact' leading to a pullback.
Third, the 'love-hate relationship' between rate cuts and BTC: What do historical patterns reveal?
Reviewing data from 2015-2025, BTC shows a negative correlation with real interest rates:
Rate cut cycles are beneficial for BTC: In March 2020, when the Federal Reserve cut rates to 0%, real interest rates turned negative, and BTC entered a bull market, with an annual increase of over 300%.
Rate hike cycle suppresses prices: The rate hikes in 2022 led to a surge in real interest rates, causing BTC to plummet 65% over the year.
Current contradiction:
Expectations have been partially digested: The market has priced in two rate cuts in 2025; if the actual cut is less than expected, BTC could be under pressure. Inflation rebound risk: Trump's tariff policies may increase imported inflation; if PCE data rebounds, the Federal Reserve may delay rate cuts, putting pressure on risk assets.
Fourth, the judge's viewpoint: Can BTC break through the consolidation?
If there is a 25 basis point rate cut in September, leading to a drop in real interest rates, BTC may break through the 119000 resistance level, targeting 125000.
If the price breaks the range, it may return to 119000-120000. The judge predicts that BTC's future movements may retrace to 117000 due to insufficient momentum before breaking 120000. For specific support and resistance levels, see the judge's introduction.
The Federal Reserve remains inactive, and BTC continues to fluctuate, expanding the range to 115000-125000.
If core PCE exceeds expectations and rate cuts are paused, BTC may retrace to the 110000 support level.
Short-term: Focus on the breakout of the 119000 resistance level; if it breaks with volume, consider entering a small position.
Long-term: If a rate cut cycle begins, consider phased investments, targeting 120000-125000.
The battle between policy and technology: who will dominate?
Trump's 'interest rate war' has yet to show a clear victor, but BTC stands at a turning point. Technical indicators suggest volatility will soon end, and every slight movement on the policy front could become a 'catalyst' to break the deadlock. Retail investors should closely monitor two key signals: the Fed's actions in September and the breakout of the 119000 resistance level.
Do you think Bitcoin can break through 120000 today? Everyone is welcome to leave a message!!
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