- BTC jumped to $109,343 after Trump called the Fed rate “3 points too high,” sparking speculation of extreme rate cuts.
- Analysts warn of inflation above 5% and housing surges, with assets like gold, S&P 500, and oil forecast to rally short-term.
- Technical signals show bullish breakout, with tight Bollinger Bands and rising volume hinting at further upside for Bitcoin.
Bitcoin (BTC) spiked dramatically to $109,343 on July 9 following a bold Truth Social post from President Donald Trump, in which he declared that the U.S. federal funds rate is “at least 3 points too high.” Within just 30 minutes, BTC began climbing as markets absorbed the implications of such a drastic monetary shift. According to CoinDesk Research, the move marked a 0.8% daily gain, pushing BTC close to new cycle highs and signaling renewed bullish momentum across risk assets.
Trump’s Post Ignites Inflation and Market Speculation
Trump’s post at 10:00 a.m. ET framed the current rate as a $360 billion annual burden, arguing that a 300 basis point (bps) cut would ease pressure on U.S. debt refinancing. Analysts from The Kobeissi Letter immediately weighed in, estimating a more modest $174 billion in first-year savings — with long-term effects possibly reaching $2.5 trillion. However, they warned that slashing rates by such an extreme amount, especially outside a recession, would be unprecedented and inflationary. Their forecast includes gold surging to $5,000, the S&P 500 to 7,000, and housing prices jumping 25%.
Technical Signals Point to a BTC Breakout
Bitcoin’s chart echoed the shift in sentiment, breaking out from earlier consolidation as volume soared post-announcement. Resistance at $109,761 was tested while support formed around $108,500, confirming a bullish price structure. Notably, Bollinger Bands compressed to their tightest formation of the cycle — a historic precursor to explosive moves. This, combined with accumulating institutional interest, hints that BTC’s next leg up may just be beginning.
Macro Outlook and Market Implications
While Trump’s suggested cut is politically driven and far from a certainty, the market reaction underscores crypto’s sensitivity to potential liquidity shifts. A dramatic rate cut would flood markets with risk-on capital, drawing flows into hard assets like BTC. Yet macro strategists caution that without fiscal restraint, such monetary stimulus could ignite runaway inflation, destabilize the dollar, and force future emergency tightening — creating volatility far beyond crypto.
