On July 31, Federal Reserve Chairman Jerome Powell stated that they would keep benchmark interest rates at the current level, that is, 525-550 basis points. However, he also emphasized that an interest rate cut could be made in September if inflation continues to cool.

After Powell’s comments, Bitcoin fell 5% to approximately $63,400 on August 1. BTC’s price reaction was similar to previous reactions to the Fed’s interest rate decisions in 2024.

For example, after the Federal Open Market Committee (FOMC) meeting concluded on June 12, the price fell approximately 7.25%. Similarly, it fell more than 7% following the FOMC’s May 1 meeting. The declines after these FOMC meetings indicate an increasing tendency to reduce risk among investors.

When the Federal Reserve’s policy decisions and the economic outlook create uncertainty, investors often reduce their exposure to risky assets; This explains why the Bitcoin price dropped today.

Today’s Bitcoin price drop appears to have been further accentuated by Kamala Harris’ chances of winning against her pro-crypto rival Donald Trump in November’s US election. On July 31, Harris won 48% approval to Trump’s 47% in key swing states for the first time since launching her presidential campaign.

Harris’ odds of winning have also improved on the Polymarket betting platform, but she remains behind Trump. Bitcoin’s price could decline if investors perceive the increased likelihood of tighter cryptocurrency regulations under a potential Democratic administration. Harris’ rise in key swing states could reinforce these concerns.

Today’s Bitcoin drop is based on July 30 Mt. It followed the transfer of 47,000 BTC worth approximately $3.02 billion from Gox to the Kraken and Bitstamp crypto exchanges. This transfer, Mt. It is part of the process of distributing recovered funds among Gox’s creditors.

The transfer window coincided with increased sales activity on Kraken, one of the designated exchanges. According to data analytics platform Glassnode, Bitcoin’s Spot Cumulative Volume Delta (CVD)—an indicator that measures the net difference of buying and selling transactions—has been trending in favor of sellers since July 27, with Mt. It reached its highest level on the day of the Gox transfer.

From a technical perspective, Bitcoin’s decline is seen as part of an ongoing correction that began after testing several months of downtrend line resistance. This trendline forms part of a broader downward channel pattern.

As of August 1, BTC’s price is above the 50-day exponential moving average (50-day EMA; red wave) at approximately $64,300 and is targeting a bounce towards the upper trend line of the channel near $68,250.

However, if Bitcoin falls clearly below the 50-day EMA support, it could decline further into the range defined by the 200-day EMA (blue wave) and the lower trend line of the channel, i.e. the $59,500-$54,500 region.