10xResearch: Should YOU BUY Bitcoin and SELL Bitcoin Miners Before the FOMC Decision?

👇1-15) Bitcoin appeared to break out on Monday, with prices briefly reaching $70,000. However, as we cautioned in our report, ' Bitcoin Breakout? Not so fast. What Traders Need to Know,' we emphasized that without macroeconomic support, Bitcoin would likely remain in its challenging trading range.

👇2-15) However, today's developments could potentially change that.

👇3-15) The spotlight is on Powell to convey that the FOMC is cautiously considering rate cuts in upcoming meetings (September). Without a clear indication of a forthcoming rate cut, Bitcoin and stocks may fall short of current market expectations, which are more aggressive than the 1 to 2 cuts the FOMC anticipated just six weeks ago. Most analysts predict a total of 50 basis points of cuts this year, likely in September and December, with a few expecting up to 75 basis points of reductions in 2024.

👇4-15) The SP 500's performance following the first rate cut after a prolonged hiking cycle has varied, reflecting broader economic conditions. Positive outcomes include the July 1995 soft landing with continued growth and a strong economy in 2019 before the COVID-19 pandemic. Negative outcomes occurred after the January 2001 and September 2007 cuts, leading to the dot-com bubble burst and the Great Recession, respectively.

👇5-15) After the first rate cut in February 1989, the SP 500 increased by 14.5% six months later and 18.4% twelve months later. Following the July 1995 cut, the SP 500 rose by 11.8% in six months and 22.9% in twelve months. However, after the January 2001 cut (with the US entering a recession two months later), the SP 500 fell by 10.2% six months later and 16.2% twelve months later.

👇6-15) Following the September 2007 cut, the US entered the Global Financial Crisis, with the SP 500 declining by 10.4% six months later and 20.3% twelve months later. After the rate cut in July 2019, the SP 500 was up 9.8% six months later and 19.4% twelve months later. Bitcoin also increased by 9.9% six months after the July 2019 cut and was up 0.1% twelve months later.

👇7-15) Since 1900, 25 U.S. presidents have begun their first term, with 11 experiencing a recession within their first year, resulting in a 44% probability of a recession during the first year in office. As of June 2025, YCharts reports a 55.83% chance of a recession, up from the previous month but down from last year. Rosenberg Research's model indicates an 85% chance of a recession in 2024, the highest since the Great Recession.

👇8-15) Meanwhile, Goldman Sachs has lowered its 12-month recession probability forecast to 20%, down from 25%, due to stronger-than-expected economic data. While recession risks remain elevated, they appear contained over the next year, despite the historically high likelihood of a recession during the first presidential year.

👇9-15) With inflation declining over the past few months and the labor market showing increasing risks, as evidenced by the unemployment rate rising above the critical 4.0% mark, conditions for rate cuts are becoming favorable. We anticipate Powell will signal that the Fed is considering rate cuts in the upcoming FOMC meetings. Historically, stocks tend to rally following rate cuts, particularly after periods of decline like we've experienced. Therefore, we expect a rebound in both stocks and Bitcoin.

👇10-15) Several Bitcoin miners are set to report earnings in the coming days, marking the first reports since the recent halving. With the deployment of more efficient Bitcoin mining machines in recent weeks, the total hash rate has reached a new all-time high of 660m TH/s. This increase in hash rate has led to higher network difficulty. As miner revenues remain depressed, it is expected that earnings will likely disappoint.

👇11-15) In recent months, Marathon Digital Holdings significantly boosted its mining capacity, energizing 5,000 additional miners by the end of May 2024, increasing its fleet to about 246,000 Bitcoin miners. The company has also been selling Bitcoin to support operations, selling 600 BTC in April and 390 BTC in May. Since the halving, Bitcoin mined has decreased from 850 in April to 616 in May and 590 in June, a 30% decline.

👇12-15) Marathon Digital Holdings, as the industry benchmark, is expected to report a quarterly loss of $0.19 per share on August 1 (after market), reflecting a year-over-year decline of 46.2%. Revenues are projected to reach $161.04 million, a 97% increase from the same quarter last year. Marathon’s realized hashrate declined to 75% in June. The company has missed earnings per share expectations in all four of the last quarterly releases, with the last two earnings reports causing the share price to drop by 13% and 17% the following day. This scenario could repeat itself this week.

👇13-15) We've maintained a cautious stance on miners since June 14, when Bitcoin was trading at approximately $66,000. Our bearish outlook on Bitcoin, which subsequently dropped to $53,500 in early July, proved to be accurate – although prices quickly rebounded. While mining remains a challenging sector, it frequently presents opportunities to capitalize on higher beta trends.

👇14-15) A disappointing earnings report from Marathon will likely trigger a sharp decline in its share prices, potentially offering attractive entry points. Over the next few months, Bitcoin could reach new all-time highs, bolstered by a more accommodative Fed policy, including potential rate cuts over the next few months.

👇15-15) This could lead to a rebound in Bitcoin mining share prices. While we remain cautious with highly risky and volatile assets, depressed prices may offer opportunities for patient investors to be rewarded. Historically, the fourth quarter (October, November, and December) is typically the strongest for Bitcoin. The opportunity for bargain hunting may be just around the corner.