CoinDesk 20 Index: 1,925.79 +5.55%
Bitcoin (BTC): $62,521.19 +4.22%
Ether (ETH): $2,428.37 +5.2%
S&P 500: 5,618.26 -0.29%
Gold: $2,585.66 +1.03%
Nikkei 225: 37,155.33 +2.13%

Bitcoin rose above $62,000, buoyed by the U.S. Federal Reserve's 50 basis-point rate cut on Wednesday. Reductions in borrowing costs are traditionally a bullish indicator for risk assets such as cryptocurrencies, and easing cycles have historically coincided with surges in BTC's price to all-time highs. Bitcoin has added about 4.35% in the last 24 hours while the digital asset market at large has risen over 5%, as measured by the CoinDesk 20 Index (CD20). Leading altcoins ETH and SOL lead the gains, up 5.8% and 7.4%, respectively.

Despite the long-awaited U.S. rate cut appearing to have the desired effect on crypto markets, traders are warning the rally could be short lived. They argue the bigger picture of economic slowdown and geopolitical uncertainty will hold back cryptocurrency price gains. Presto Research noted the mixed reaction across asset classes to the rate cut, which demonstrates that "growth concerns clearly exist." Arthur Hayes, CIO of Maelstrom, argued that rate cuts will fuel inflation, which could see markets falter and then "they're just going to do more of it and they’re going to make the problem even worse."

Crypto Finance, a subsidiary of Germany's largest stock exchange operator, signed a deal with Commerzbank to offer trading services to the lender's corporate clients just two weeks after reaching a similar agreement with Zürcher Kantonalbank in Switzerland. Commerzbank will provide custody services, the companies said on Thursday. The trading service offered by the Deutsche Boerse unit will be available to clients based in Germany and initially focus on trading in the two largest cryptocurrencies, bitcoin and ether. Commerzbank obtained a crypto custody license in Germany in November 2023, allowing the financial services firm to offer a wide range of services related to digital assets.

Ether has advanced in the past 24 hours to trade around $2,434. More importantly, the second-largest cryptocurrency found key support at its 200-week simple moving average (SMA) of $2,298.

The 200-week SMA is widely used for gauging long-term momentum. If the price of an asset rises above that level, it is generally considered to be in an uptrend, and vice versa. The move higher was triggered after the Fed's decision to cut interest rates by 50 basis points, setting the current target rate between 4.75% and 5.00%.

Ether has bounced off this support multiple times, including on Aug. 5, when broader markets experienced a sell-off triggered by the yen carry-trade unwind. This support has held for much of September.

In the meantime, bitcoin was changing hands at above $62,000 marking the first higher low for the token since its March all-time high, signaling constructive price action. To push further into bullish territory, bitcoin will need to break through the $65,000 resistance level to mark a higher high and continue the upward momentum.

- James Van Straten