Asia Market Open: Bitcoin Surpasses $90k as Rate Cut Speculations and Tech Strength Enhance Risk Appetite

Bitcoin

In a positive start to the trading day, Bitcoin has risen above $90,000, buoyed by heightened expectations of an interest rate cut by the Federal Reserve and a resurgence in technology stocks. Despite light trading volumes due to the holiday season, investors are showing increased risk appetite ahead of the Fed’s final policy meeting of the year.

Key Takeaways

Bitcoin has climbed to $91,229, marking a 4.3% increase.
There is an 85% likelihood of a 25-basis-point rate cut by the Federal Reserve next month.
Major U.S. technology stocks are contributing to market gains after strong earnings reports.
Asian equity markets are up, reflecting improved investor sentiment.
Investors are closely observing the situation in China’s property sector.

Bitcoin Surges Above $90,000 Amid Positive Market Conditions

Good morning, Asia! Here’s what’s shifting in the markets as the bell rings.

On Thursday, Bitcoin surged back above the $90,000 threshold as Asian markets opened on a generally optimistic note. Stocks showed strength, and the dollar weakened amid rising hopes that the Federal Reserve will announce a rate cut in December.

Trading volumes remained modest during this holiday-shortened week, with the U.S. markets closed on Thursday for Thanksgiving and only a brief session expected on Friday.

Nonetheless, investors embraced higher risk, inspired by the latest tech-driven rally in Wall Street and preparing for the Fed's final policy meeting of the year.

The expectations surrounding interest rates are playing a significant role. According to the CME FedWatch tool, futures contracts now indicate about an 85% probability of a 25-basis-point rate cut next month, a sharp increase from approximately 30% a week ago.

Market Snapshot

Bitcoin: $91,229, up 4.3%
Ether: $3,038, up 2.8%
XRP: $2.21, up 1.1%
Total Crypto Market Cap: $3.19 trillion, up 4.1%

Fed Remarks Influence Investors as Economic Data Lags

Recent economic data, which has emerged after a 43-day government shutdown that concluded in mid-November, has made investors rely more on the comments from Federal Reserve officials for clear policy direction.

This week’s statements from San Francisco Fed President Mary Daly and Fed Governor Christopher Waller further pushed investors to believe that the central bank is preparing to shift from maintaining rates to easing them.

Additionally, data released on Wednesday reported a drop in new unemployment benefit applications to a seven-month low, suggesting layoffs remain under control and supporting hopes for a soft landing in the economy.

U.S. Markets Rally on AI Optimism

U.S. markets saw continued gains on Wednesday, driven by a strong performance in technology stocks and a growing belief in a possible rate cut in December. All three major U.S. stock indices reported gains for four consecutive days, rebounding from last week’s downturn, which was fueled by concerns over soaring valuations in the tech sector.

Investor worries eased after Nvidia reported strong quarterly results and positive guidance, reinforcing confidence in ongoing demand for artificial intelligence infrastructure. Similarly, Dell Technologies’ optimistic revenue outlook further stabilized sentiment surrounding AI-related stocks.

Crypto traders balanced their focus between macroeconomic factors and technical charts. Piyush Walke, a derivatives research analyst at Delta Exchange, indicated that Bitcoin remains below its 50-day and 200-day simple moving averages, with resistance holding near $93,000.

He also noted that Ethereum recently bounced off a long-term ascending trendline serving as major support. A firm daily close above the $3,000 to $3,050 range could signal a move toward $3,200 to $3,300.

Asian Stocks Gain as Investor Sentiment Improves

Asian equity markets mirrored the improved risk sentiment with MSCI’s broad index of Asia Pacific shares outside Japan rising by approximately 0.27%, potentially ending a three-week losing streak. Both Japan’s Nikkei and South Korea’s Kospi gained over 1% in early trading.

The situation in China’s property sector remains a critical risk point. Investors are closely monitoring developments as major developer China Vanke seeks approval to postpone repayment on a 2 billion yuan (about $282.6 million) onshore bond.

Despite these concerns, cryptocurrency and equity markets are on a similar trajectory. With Bitcoin above $90,000, a resurgence in tech stocks, and an anticipated Fed rate cut approaching, Asia begins its trading day with a strong, albeit cautious, appetite for risk.