Bitcoin Loses Momentum as Bond Yields Cool
Bitcoin's price slipped below $80,000 as it fell in line with falling US bond yields and gold prices. This comes as traders had previously marked the $80,000 zone as an area of strong sell pressure.
The price drop was seen on Tuesday's Wall Street open, where Bitcoin (BTC) initially reached a 14-week high of $81,265 but then fell to a low of $78,111. Gold prices also declined, with XAUUSD hitting local lows of $4,605 per ounce, down nearly 2% on the day.
US stocks, however, moved inversely to gold and crypto, posting modest daily gains of 0.2% and 0.5%, respectively, for the S&P 500 and Nasdaq Composite Index. This divergence has continued this week despite a brewing trade-tariff spat between the US and Canada.
The cooling bond yields and gold prices come after a recent surge in crypto markets, which was driven by high bond yields. However, The Kobeissi Letter suggests that interest-rate cuts are not an option in the current inflation environment, making direct bond market intervention a more likely solution to drive interest rates lower.