Bitcoin Climbs to $119.5K on Trade Optimism, Eyes on Fed and Crypto Policy Update

• Bitcoin rises to $119.5K, lifted by easing U.S.–EU trade tensions.

• Investors await the Fed's rate decision and a critical U.S. crypto policy report due July 30.

• Ether hits a seven-month high, leading broader altcoin rally.

• Market sentiment improves, but caution persists amid macro uncertainties.

Bitcoin edged higher on Monday, reaching above $119,000 after rebounding from recent lows. The gains were fueled by improved market sentiment following the announcement of a new U.S.–EU trade agreement, which helped boost risk appetite across financial markets.

As of 02:18 ET (06:18 GMT), Bitcoin was trading at $119,552.6, up 1.1% for the day.

Despite the rise, the world’s largest cryptocurrency remained confined to a narrow range as traders exercised caution ahead of two key events: the Federal Reserve’s policy meeting this week and a U.S. crypto regulatory report expected on July 30.

Trade Deal Boosts Sentiment, But Policy Risks Remain

Investor confidence received a boost after the U.S. and EU reached a framework agreement on Sunday. The deal reduced tariffs on European imports to 15% from a potential 30%, while the EU committed to purchasing $750 billion worth of U.S. energy and pledged major investments in defense and infrastructure.

This development helped ease geopolitical and trade uncertainties, encouraging investors to move away from safe-haven assets and toward riskier assets like equities and cryptocurrencies.

However, market enthusiasm remains tempered by broader macroeconomic risks, particularly the Federal Reserve's policy stance and regulatory developments in the crypto sector.

Fed Meeting and Crypto Policy Report in Focus

The Federal Reserve is widely expected to keep interest rates unchanged at its current target of 4.25%–4.50% when its two-day meeting concludes on Wednesday. However, investors will closely monitor the central bank's forward guidance, particularly regarding potential rate cuts later this year.

A dovish tone from the Fed could further support Bitcoin prices, as lower interest rates typically make risk assets more attractive compared to low-yielding safe investments.

Meanwhile, the upcoming U.S. crypto policy report on July 30 is also being closely watched. The report is expected to outline plans for a strategic national bitcoin reserve and provide clearer regulatory guidelines for the crypto sector, including stablecoins.

Greater clarity could pave the way for increased institutional participation, a key driver for the next phase of crypto adoption.

Altcoins Rally: Ether, Solana, Dogecoin Lead Gains

While Bitcoin saw modest gains, altcoins outperformed amid improving sentiment.

• Ether (ETH) surged over 4% to $3,924.15, marking its highest level since December 2024.

• XRP climbed 3.2% to $3.30.

• Solana (SOL) added 3.5%, Cardano (ADA) rose 2.4%, and Polygon (MATIC) gained 2.2%.

• Among meme coins, Dogecoin (DOGE) advanced 4%, while $TRUMP tokens gained 2.2%.

These broad-based gains highlight growing optimism around the crypto market, even as investors brace for potentially market-moving policy news in the coming days.