Bitcoin's Comeback Trail: Can Macro Headwinds Stall Its Momentum?
Bitcoin has staged a significant recovery since its summer lows, climbing over 38% from its intraday low of $57,748 on July 1 to reach above $80,000 last week.
The move is notable because it puts the once-abandoned price target of $100,000 back within striking distance. However, a wall of macro headwinds stands between here and there, including inflation concerns, higher interest rates, trade uncertainty, and a bond market that refuses to behave like a safe harbor.
The institutional access to Bitcoin has become easier since the launch of spot ETFs, with BlackRock's iShares Bitcoin Trust ETF having over $60.2 billion in net assets as of September 1. The recent jobs report showed why investors shouldn't confuse momentum with certainty, as it pushed traders toward higher expectations for a September Federal Reserve rate hike.
The problem is that the macro backdrop is not favorable for risk assets, with oil prices surging due to the U.S.-Iran war and bond yields approaching 5%. The strong August jobs report also increased market expectations for a rate hike rather than a cut.