Fed's Rate Hike Odds Tumble, Setting Stage for Potential Bitcoin Breakout

The Bitcoin price has been stuck in a range of $62,000 to $68,000 for weeks, but recent market developments may be about to break it out. The Federal Reserve's (Fed) September rate hike odds have fallen from 80.5% to 57.4%, and Brent crude oil prices have dropped by more than 5%. These factors typically ease two major macro pressures that have capped crypto growth all year.

However, a rate hike is still the base case for the Fed, despite the decrease in odds. The July jobs report on Friday will be crucial in determining whether this scenario holds true or not. A 'Goldilocks' print, moderate hiring, softer wage growth, and stable unemployment, would make a Bitcoin breakout more believable.

On the other hand, a hot report with strong wage growth would rebuild the case for a September rate hike and hurt Bitcoin's setup. If payrolls collapse enough to eliminate hike odds, Bitcoin could experience a brief rally as yields fall, but then give those gains back once weak data starts to read as a growth shock.