Bitcoin Nears All-Time High As Market Eyes U.S.-China Talks And Fed Decision

Bitcoin BTC/USD is trading at $109,301.68, after gaining 3.43% in a day, 4.04% over the past week, and 5.13% in the last month. The recent rally brought the price close to its all-time high of $111,970 as optimism about U.S.-China trade talks and expectations of a Federal Reserve rate cut are creating bullish momentum.

U.S. Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick met with Chinese Vice Premier He Lifeng in London earlier this week. The officials discussed potential tariff rollbacks and export controls. A positive outcome could signal to the market that geopolitical tension between the U.S. and China is easing. Hope for progress helped Bitcoin get out of a recent consolidation phase during which its prices struggled to gain traction after a pullback from May’s $112,000 peak.

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Traders are also watching for macroeconomic signals when the Federal Reserve announces its next interest rate decision on June 18. While no change is expected this month, futures markets believe a rate cut could come as early as July. Rate cuts typically weaken the dollar, making riskier assets like Bitcoin more attractive.

Anticipation of a more dovish policy by the Fed has already revived ETF inflows and long activity. In the last three weeks, Bitcoin has bounced back from lows of $100,000. Over $155 million worth of short positions have been liquidated, including $81 million in BTC.

James Toledano, COO of Unity Wallet, said the aggressive short burn shows renewed institutional demand for Bitcoin. He believes the market seems more confident recently, even with concerns like a recent U.S. credit rating downgrade.

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Bitfinex analysts noted that aside from rate expectations, BTC's current momentum is not supported by any new macro or structural developments. Bitcoin may not easily surpass the $112,000 level without a solid new catalyst. Many long-term holders, especially those who bought in Q1 at lows of $78,000, are facing pressure to decide whether they should take profits or not. Their choices can have a major impact on the next market move.

Analysts are pointing out how the profit-taking zone between $112,000 to $125,000 is dense, which can stall or reverse the rally without a sustained buying volume. According to past records, Bitcoin has historically settled into lengthy consolidation periods after testing all-time highs like it did in 2024 when it went back to $20,000 after a March peak.

According to CoinGlass, if Bitcoin moves above its all-time high, approximately $1.1 billion in short positions will be wiped off the board. If prices do break above their previous highs (without real-world policy changes or a structural development), it could still be short-lived.

Bitcoin’s price is supported by positive macro speculation, and an increase in risk appetite. Volatility will exist as geopolitical tensions have not completely subsided, and the Federal Reserve decision is due. Traders need to watch out for these events as they can impact Bitcoin’s short-term future.

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