The price of Bitcoin (BTC) is showing clear neutrality today on Monday, trading at around $27,800. After days of sideways movement despite increased blockchain transaction activity, a strong price movement in Bitcoin is anticipated soon.
It’s worth noting that U.S. bond yields continued to rise over the past week, reaching their highest levels since 2007. The 30-year bond yield was trading at 4.96% on Monday, while the 10-year bond yield rose to 4.79%.
What does the price of Bitcoin expect: Will it rise towards $30,000 or drop to $25,000? Typically, rising yields and yield curve inversions are signs of an economic recession.
As a result, Bitcoin’s price movement is currently neutral, as many investors are shifting from risk assets to safer money market funds. Bitcoin has also outperformed U.S. stocks in recent weeks, with its price moving sideways while major indices like the Dow Jones saw significant declines.
Bitcoin’s reaction to the latest U.S. jobs data has been moderate, as these numbers revealed the addition of over 336,000 jobs in September, following a gain of over 227,000 jobs in the previous month. The unemployment rate increased to 3.8%, and wages dropped to 4.2%, indicating that the labor market remains strong.
These figures boosted risk-off sentiment, causing the U.S. Dollar Index (DXY) to decline to 105.8, while U.S. stocks rallied during the past week.
As a result, the upcoming Federal Reserve (FOMC) meeting on October 10 is a highly significant event for the markets, where Federal Reserve Chair Jerome Powell could reinforce the idea of another interest rate hike in November. Expectations were initially at 30.9% for a 25-basis point rate hike, but after the recent jobs report, this figure dropped to 21.2%.
The majority still believes that the Federal Reserve will keep the interest rate between 5.25% and 5.50% unchanged until the end of this year.
In my opinion, the key upcoming drivers that could impact Bitcoin and digital currencies are the Federal Reserve meeting minutes and U.S. inflation data.
Economists expect the data to show a decrease in the core consumer price index from 3.7% in August to 3.6% in September. Additionally, any judicial or governmental decisions regarding the regulation and licensing of Bitcoin companies and funds will remain fundamental factors in the markets.