Analysis: Bitcoin has risen for five consecutive trading days, indicating that the market's confidence in the prospect of a rate cut by the Federal Reserve this year has strengthened

According to Bloomberg, Bitcoin has broken through the $71,000 mark and has risen for the fifth consecutive trading day, reflecting increased confidence in the global market about the prospect of a Federal Reserve rate cut this year.

After data showed a slowdown in U.S. inflation and softening job market, traders expect that it's more likely for the Fed to cut rates as early as November. Some U.S. Treasury yields have seen their biggest two-day drop so far this year, and a relaxed financial environment may benefit speculative assets such as cryptocurrencies.

Tom Couture, Deputy Head of Digital Asset Strategy at Fundstrat Global Advisors said in a report: "Cryptocurrencies respond positively to interest rate cuts."

In addition, short-term 30-day correlation between Bitcoin and Nasdaq 100 Index is approximately at its highest level since early 2023. This suggests that further rise of this stock index could be accompanied by an increase in Bitcoin.

Michael Novogratz, founder and CEO of Galaxy Digital and billionaire stated on Bloomberg TV that a more positive political environment towards digital assets in the United States could help push Bitcoin to reach record-breaking $100k or even higher by end of this year.