Matrixport, a digital asset financial services group that emerged from Bitmain, an industry leader in bitcoin mining, projects bullish breakout for Bitcoin in the upcoming fourth quarter of 2024. In its latest research report titled “Matrix on Target: Bullish Prospects for Bitcoin in Q4,” the firm provides four reasons to be bullish in the coming weeks.

#1 Narrower range trading signals Breakout

Matrixport’s analysis begins with a technical assessment of Bitcoin’s recent price action. Historically, Q3 has been a challenging time due to recurrent breakout failures. This year, however, Bitcoin has shown a noticeably narrowing trading range, a pattern that typically precedes significant price volatility. “A contraction in price movement is often a precursor to aggressive price action, suggesting an impending breakout,” the report notes.

#2 Monetary Policy as a Catalyst for Bitcoin

A key aspect of the report focuses on the US Federal Reserve’s interest rate policy. The Fed is currently maintaining the rate at 5.25%, as opposed to the inflation rate of 3.0%.

However, recent comments from Fed Chairman Jerome Powell have fueled speculation about a possible rate cut at the September FOMC meeting. “If inflation follows the projected path, a rate cut at the September meeting is possible,” Powell said.

Matrixport’s analysis correlates these potential rate cuts with increased market liquidity, which has historically benefited risk assets like Bitcoin. “Each quarter-point reduction by the Fed could inject significant liquidity into the market, making nontraditional assets more attractive,” the report explains.

#3 Impact of the US Presidential Election

The upcoming US presidential election also figures prominently in Matrixport’s forecast. The firm speculates on the impact of a potential re-election of Donald Trump, noting his previous administration’s relatively hands-off approach to cryptocurrency regulation. “A Trump re-election could provide renewed vigor for regulatory reform or easing, providing a less uncertain landscape for cryptocurrency innovation,” the report suggests.

Trump’s recent appearance at the Nashville Bitcoin conference, while falling compact of some expectations, was largely received positively, signaling potentially supportive stances toward the cryptocurrency if he is re-elected. Trump promised to sell Bitcoin previously confiscated by the U.S. government and create a “national supply” of Bitcoin.

As NewsBTC reports, this move, if it comes to fruition, could have significant implications for BTC game theory. It could trigger a race for rapid allocation, with nations printing money to buy as many Bitcoins as possible.

#4 Bitcoin Seasonal Patterns

The report also delves into seasonal patterns affecting Bitcoin’s performance, highlighting the typically ponderous months of August and September. This pattern is attributed to lower trading volumes during the summer holidays and market caution as it awaits economic indicators and central bank policy decisions in the fall.

However, Matrixport believes that this year’s exceptional economic and political situation may disrupt these typical trends, creating conditions for an unseasonable recovery.

Overall, Matrixport maintains a cautiously bullish view on Bitcoin’s performance in Q4 2024. “Given the confluence of a narrowing price range, likely US monetary easing, and potential US presidential election fallout, we are poised to witness a significant bullish breakout in Bitcoin’s price trajectory,” the report concludes.

At the time of going to press, the BTC price was $64,730.

Featured image created with DALL E, chart from TradingView.com