Bitcoin Bounces Back into the $58,000 Zone
After a dip below $56,000 early in U.S. trading yesterday, Bitcoin has rallied over 1% today, sliding back cleanly to the $58,000 level. The crypto tonne’s bounce follows a surprisingly upbeat turn in the U.S. stock markets.
Wall Street Finds a Silver Lining
- August Inflation Report: Core inflation rose faster than expected, initially dampening investor sentiment.
- CPI Mix: Although the mixed Consumer Price Index data put downward pressure on markets, they did not derail the consensus on the Fed’s future moves.
- NASDAQ 100 Surge: A 2%+ rise in this risk‑y index signalled a fresh appetite for volatility, giving supporting lift to crypto assets.
Crypto’s Rollercoaster Ride Continues
Despite the optimism in equities, the crypto market is still waking up to the bruises it suffered from last week’s hard pullback. Bitcoin spot ETFs have had a challenging season: a welcome inflow of roughly $146 million in the first two days this week was topped up by a negative outflow of over $43 million yesterday.
The road ahead for cryptocurrencies hinges largely on macro‑financial triggers. We are at a crossroads: either inflation eases gently (soft landing) or it takes a nosedive into a recession.
Future Rate Cuts as a Key Driver
- Fed Outlook: The market signals an 87% chance of a 25‑cent hike cut next week, with a strong possibility of a 50‑cent cut instead.
- Long‑Term Forecast: By year‑end, an 80% probability that the Fed could trim rates by a whole point is bubbling beneath the surface.
In short: better than expected inflation readings, a strong stock market rebound, and a growing expectation of future rate cuts are all tending to lift Bitcoin’s spirits — but the crypto community remains on guard, ready for the next shock.
