Is Bitcoin poised to break 120,000 USD? After the Federal Reserve (FED) cut interest rates, a historic bull run pattern may repeat.

On September 18, the trading price of Bitcoin was approximately $116,210, and traders are closely following the market impact of the Federal Reserve's first interest rate cut in nearly a year. This rate cut could become a key catalyst for Bitcoin's price to break through historical highs, similar to the bull run triggered by the loose monetary policy in 2020.

The Federal Reserve (FED) cuts interest rates: A new growth engine for Bitcoin?

(Source: Fed)

The Federal Reserve (FED) lowered the benchmark federal funds rate by 25 basis points to a target range of 4.00%-4.25%. This move was widely anticipated in the market following a slowdown in job growth and a continued decline in inflation over several months. Chairman Powell stated that this is a “risk management rate cut,” as the Federal Reserve (FED) is shifting to a more data-dependent approach.

New economic forecasts show:

· The GDP growth rate of the United States in 2025 is 1.6%

· The unemployment rate is expected to reach 4.5%

· The inflation rate will drop to 2% in 2028.

Powell's remarks initially calmed some investors, but as the press conference proceeded, the market began to show volatility, reflecting the tension between loose monetary policy and economic uncertainty. For Bitcoin, which is both a risk asset and an inflation hedge, its future trend will depend on the interplay between the Federal Reserve's dovish stance and technical charts.

Technical Analysis: Rising Wedge and Key Support Levels

(Source: Trading View)

From a technical perspective, Bitcoin has formed an ascending wedge, which is a bearish continuation pattern that often appears when upward momentum begins to weaken. After failing to hold the resistance level of $117,300, BTC is currently testing the support area of $115,800 and is supported by the 50-period SMA and the lower boundary of the wedge.

Technical indicators show:

· The RSI has fallen below 50, indicating a weakening momentum.

· The recent candlestick patterns show that the market is indecisive.

· The small physical form suggests a wait-and-see attitude among traders.

If sellers dominate, TradingView's path prediction suggests that Bitcoin may drop to $114,400, or even further down to $113,200, at which point the 200 moving average will overlap with the previous demand area. The appearance of three black crows candlestick patterns below the support level will confirm the continuation of the bearish trend.

Possibility of a Bull Run Repeating in 2020

Despite short-term technical pressures, the bulls have not disappeared. If Bitcoin holds above 115,800 and forms a bullish engulfing candlestick or hammer at the support level, a rebound may occur. A breakthrough above 117,300 will offset recent downward pressure, opening the path to 118,500 and 119,350.

For traders, the level of $115,800 is the key bottom line:

· Above this level, the market will attract new bulls, with a target price of $118,000-$119,000.

· Below this level, the market will experience a deeper correction.

• Overall, the entire cycle's lows are consistently rising, still supporting the long-term bull run assessment.

If the Federal Reserve's rate cut cycle aligns with that of 2020, when the loose monetary policy drove one of the strongest bull runs in Bitcoin's history, a new wave of institutional demand may emerge. In this scenario, BTC's next breakout could surpass short-term resistance and advance toward the $130,000 region in the coming months.

For investors, today's market volatility reflects more the strategic positioning of Bitcoin in the next phase of global liquidity expansion, rather than short-term noise.