Bitcoin Skyrockets to $37K Amid Argentina Election Upset, Analysts Eye Fed Signals

The cryptocurrency market experienced a 2% increase in the past 24 hours, with a particular focus on artificial intelligence (AI) tokens driving weekend trading gains. Monday saw Bitcoin (BTC) surpassing the $37,000 threshold, propelled by the victory of Javier Milei, a pro-bitcoin candidate, in Argentina's presidential election. Despite Milei's outspoken support for bitcoin as a means of returning money to the private sector, he did not advocate for making it legal tender in the country.

The AI token sector demonstrated significant growth, marking an 8% increase driven by unrelated developments in emerging AI projects. Bittensor's TAO recorded a 4.2% rise, contributing to an impressive 77% rally over the past week. Other tokens in the sector, including Ocean Protocol's OCEAN, Fetch AI's FET, and SingularityNet's AGIX, saw a surge of up to 16% in the last 24 hours, outperforming major cryptocurrencies, including bitcoin.

Near Protocol’s NEAR experienced a substantial 20% increase, and the staking platform Lido’s LDO observed an 11% uptick. Traders are gearing up for a potentially eventful week, anticipating significant market movements driven by various events and announcements.

Market analyst Simon Peters from eToro drew attention to the release of the U.S. Federal Reserve's meeting notes, scheduled for the following day. These notes are expected to provide deeper insights into central bank thinking, especially in light of concerns about slowing inflation. Investors are seeking confirmation of a potential peak in interest rates.

Nvidia's announcement of its latest results on Tuesday is also eagerly anticipated, given the tech giant's pivotal role in the AI revolution. Peters emphasized the likelihood of crypto assets responding to Nvidia's announcements.

Looking ahead, Peters cautioned about potential low liquidity towards the end of the week due to U.S. financial markets closing for Thanksgiving on Thursday and the onset of the Black Friday holiday shopping season. Thin trading volumes pose the risk of increased market volatility.

Analyst Alex Kuptsikevich from FxPro acknowledged trader expectations for Federal Reserve rate cuts in the coming months. However, he suggested that such a move might only occur in response to a significant market correction, driven by damaged risk appetite.

Kuptsikevich outlined the Fed's typical cycle of rate cuts, usually initiated after a substantial market correction. He posited that a rate cut in the first half of 2024 could be triggered by severe turbulence in debt and equity markets. In the event of a broader market decline, Kuptsikevich cautioned that bitcoin might drop below $30,000 before initiating another bull cycle.

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