Bitcoin (BTC) is gearing up for a potential surge, with predictions indicating it could reach $40,000 to $45,000 by year-end, according to Markus Thielen of DeFi Research. Thielen cites several factors driving this optimism, including positive trends in the options market and dovish expectations from the Federal Reserve (Fed).
Recent bullish actions have spurred demand for call options in Bitcoin, reflecting the market's anticipation of continued price increases. This demand has put market makers in a position where they might have to buy more BTC, adding to the upward momentum.
Significantly, two major options expiries are set for November 24 and December 29, with a considerable open interest, favoring calls over puts. Thielen notes that as the price nears $40,000, more market participants will likely buy Bitcoin to hedge, further fueling its rise.
The declining U.S. inflation rate also supports a bullish outlook. With the consumer price index (CPI) dropping and the Fed potentially reducing interest rates, investment in riskier assets like cryptocurrencies could increase. Thielen anticipates the CPI to fall below the Fed's 2% target by 2024, which could lead to substantial rate cuts.
Finally, the potential approval of one or more Bitcoin spot ETFs by the SEC, as predicted by Bloomberg analysts, could further bolster Bitcoin's price. This combination of factors makes a strong case for Bitcoin's potential rise as the year draws to a close.
Disclaimer: Please note that the information provided in this article is based on the referenced research articles. It is essential to conduct further research and analysis before making any investment decisions. The cryptocurrency market is highly volatile, and investors should exercise caution and consult with financial professionals before engaging in cryptocurrency trading or investment activities.
