The trade: will fed rate cuts send Bitcoin to fresh record highs?

(AI video summary)

This video was created on 2 July for IG audiences by ausbiz.

US Tech 100 momentum wanes as rotation takes hold

The US Tech 100 snapped a six-day winning streak after pushing through record highs, with momentum fading as markets digest policy developments. The passage of legislation through the Senate has prompted investors to seek stocks more exposed to potential tax cuts.

Wall Street performed well during this rotation, remaining approximately 800 points below record highs. This creates an attractive entry point for those seeking exposure to Main Street businesses rather than technology giants.

Australia 200 consolidates amid holiday lull

The Australia 200 started the new financial year subdued, influenced by school holidays and reduced trading volumes. The index sits approximately 100 points below its record high, entering a consolidation phase as traders await key economic data releases.

Australian dollar benefits from Fed dovishness

The Australian dollar has reached fresh cycle highs amid growing expectations for earlier Federal Reserve interest rate cuts. The probability of a July rate cut has jumped from 10% to 25% following dovish comments from Fed Chair Jerome Powell.

Thursday's non-farm payrolls data will be crucial. Weaker employment figures could provide the catalyst for the Aussie to break higher toward the 0.6730 to 0.6750 area.

Crude oil and Bitcoin await direction

Crude oil is staging a modest recovery from support around $64 to $65 per barrel after last week's volatility. Thursday's jobs data will be the swing factor, with weaker figures potentially lifting oil back into the low $70s.

Bitcoin faces demand challenges as metrics slip into negative territory, indicating demand isn't keeping pace with new coins from miners. The cryptocurrency is trading within a corrective trend channel around $109,000, awaiting a catalyst for the next directional move.