Key Points
- Bitcoin [BTC] decoupled from US equities after the FOMC meeting, sliding below $65k.
- July Jobs report on Friday could impact BTC price direction.
Bitcoin [BTC] showed a surprising deviation from US equities after the Federal Open Market Committee (FOMC) meeting on 1st August, dropping below $65k while stocks reached record highs.
The FOMC maintained interest rates as anticipated, but Jerome Powell, the chair, hinted at a probable rate cut in September. Despite this, Bitcoin did not follow the US equities rally.
Market Risk Factor
Mike Novogratz of Galaxy Digital suggested that the US government might be a market risk factor. He proposed that the US might sell Bitcoin for political reasons, following Trump’s announcement of creating a strategic reserve.
QCP Capital also expressed similar market caution related to the U.S. government’s movement of $2 billion of BTC last week. As a result, they projected that BTC might remain constrained in the range after failing to clear the $70k range-high.
Impact of July Jobs Report
The upcoming market mover could be the US July 2024 Jobs report, due on 2nd August. Past jobs reports have shown that fewer added job scenarios have led to a rally for BTC. However, improved US labor markets reflected in June and July jobs reports dragged BTC lower.
Quinn Thompson of the crypto hedge fund Lekker Capital shared a similar outlook. He maintained a positive outlook for H2 2024, despite acknowledging the potential impact of Friday’s jobs report on the market.
At the time of writing, BTC was trading below $65k and could only rebound from the short-term support near $65k if the Jobs’ report favors bulls. Thus, macro factors and US politics continue to influence BTC price, making it essential to monitor these fronts for risk management.
