Bitcoin’s Fate Tied to Fed Cuts—$70K Floor Possible

• The Federal Reserve’s decision to hold rates in 2025 may trigger a market downturn, warns Timothy Peterson.
• Peterson’s model suggests a 17% Nasdaq drop could push Bitcoin down 33%, settling near $71,000.
• Despite short-term risks, analysts see BTC reaching $124,000 if it holds above $78,000.

The US Federal Reserve’s stance on interest rates in 2025 could spell trouble for financial markets, with network economist Timothy Peterson warning that the absence of cuts might spark a downturn. Such a shift could drag Bitcoin’s value down to $70,000.

“What it needs is a trigger. I think that trigger may be as simple as the Fed not cutting rates at all this year,” Peterson shared on March 8 via X. His remarks followed Federal Reserve Chair Jerome Powell’s comments on March 7 in New York, where Powell stated, “We do not need to be in a hurry and are well-positioned to wait for greater clarity.”

Bitcoin’s Projected Decline and Market Trends

Nasdaq lowest price forward model, Peterson projected how a market downturn might impact Bitcoin. His model suggests that if the Nasdaq drops 17% over seven months, Btc could fall by 33%, bringing it from its current level of $86,199 down to approximately $57,000. However, based on previous trends from 2022, he believes decline will likely be limited to the low $70,000 range.

Source: Timothy Peterson

“Traders and opportunists hover over Bitcoin like vultures,” Peterson said, adding that buyers will jump in before the price hits $57,000 if the market expects that level. Citing past examples, he recalled predictions of a $12,000 Bitcoin bottom in 2022, only for the actual floor to be $16,000—a full 25% higher than expected. Applying the same, a 25% increase from $57,000 places it likely bottom around $71,000.

In January 2025, BitMEX co-founder Arthur Hayes echoed similar expectations, predicting a pullback to the $70,000–$75,000 range. “I am calling for a $70k to $75k correction in BTC a mini financial crisis, and a resumption of money printing that will send us to $250k by the end of the year,” Hayes stated in a January 27 X post.

Bitcoin’s Technical Setup Points to a $124K Target

Despite concerns about a potential drop, technical analysis presents a bullish scenario. According to CoinRadar, Bitcoin has formed a Cup & Handle pattern on the weekly chart—a structure historically linked to parabolic moves. The key price level to watch is $78,000. If it holds above that threshold, a 57% rally could push it to $124,000.

If the cryptocurrency dips to $73,000 before rebounding, the projected upside increases to 70%. That scenario mirrors Bitcoin’s 2021 performance, when it soared 300% under similar conditions. CoinRadar emphasizes that maintaining support above $78,000 is critical, as breaking below could delay Bitcoin’s ascent past six figures until later in the year.

Source: CoinRadar

Bitcoin’s upward trajectory has historically aligned with rising trading volumes, which have been increasing in early 2025. Analysts believe this could be a leading indicator of another major breakout, much like the 2017 rally. While risks remain if the Fed sticks to its stance, long-term bullish momentum appears strong.

Crypto mining firm Blockware Solutions also offered a more optimistic view in December 2024. Assuming the Federal Reserve reverses course on rate cuts, they predict “bear case” price for 2025 at $150,000—far higher than most conservative estimates.

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