Bitcoin Tumbles Below $79,000 Amid Fed Rate Hike Concerns
Bitcoin (BTC) took a hit on Tuesday, falling below $79,000 as concerns about a potential interest rate hike from the Federal Reserve gained traction. The odds of a 25 basis point increase rose to around 60% following Friday's jobs report, which showed the US added 162,000 jobs in August against expectations of 55,000.
The jobs data also led to a rise in the US dollar and Treasury yields, putting pressure on BTC and other rate-sensitive assets. LMAX Group Market Strategist Joel Kruger noted that the crypto market has been displaying resilience despite facing various headwinds, including US-Iran tensions, rising oil prices, and higher Treasury yields.
Despite sustained ETF demand absorbing some of the pressure from the Treasury yield increase, Bitfinex analysts believe BTC is consolidating with an upside bias rather than a confirmed breakout. They point to technical indicators such as the daily Relative Strength Index (RSI) reaching overbought territory, which increases the likelihood of a pullback.
The upcoming CPI and PPI decisions could dictate Bitcoin's price action ahead of the Federal Open Market Committee (FOMC) meeting on September 16. The Producer Price Index (PPI) is expected on September 10, followed by the Consumer Price Index (CPI) data on September 11.