Bitcoin remains stuck in place. BTC/USD is moving sluggishly around the $64,000 range, down 0.5% daily, coinciding with a flat Wall Street opening. This sluggishness is an anomaly, as gold has just touched a six-week high and the S&P 500 index has printed a new record. This sharp divergence occurred just as United States economic data sent warning signals about inflation.
The ISM Services PMI report for July recorded a 0.1 point increase to 54.1. Behind that number, the employment indicator plummeted 3.6 points to 47.4 - the lowest level since March.
The Double Burden of Stagflation
The situation is further exacerbated by the Prices Paid Index metric, which surged 2.6 points to 70.3. This figure, nearing the October 2022 record, confirms that prices of goods have risen 16.9 points since March 2024. In response to this data release, The Kobeissi Letter newsletter immediately concluded that stagflation is strengthening. The US economy is now under pressure from soaring commodity prices while the labor market continues to weaken.
In the crypto market, this macroeconomic burden has not yet triggered panic. Analysis from data provider Glassnode describes the current Bitcoin market reaction as pure boredom rather than capitulation. They assess that the market regime is in a compressed phase, under-allocated, and shunned by the risk appetite of global investors. A report from Bitfinex Research reinforces this, stating that the market needs a much stronger macro trigger accompanied by a surge in transaction volume to break out of its price range.
Even geopolitical rumors failed to trigger any significant price volatility. Market speculation about rising tensions in the Strait of Hormuz between Iran and Oman proved unable to shake oil prices, with WTI crude holding steady at $76 per barrel.
Where Are Institutions Taking Their Money?
Although the spot market appears stagnant, other pressures are looming from the interest rate front. The @WatcherGuru account on X noted the view of Fed Chair Kevin Warsh, who is prepared to raise interest rates in September if inflation figures come in higher than initial expectations.
However, one data point runs counter to all the negative sentiment above: the money inflows have not stopped. On-chain monitoring from the @lookonchain account reveals that spot Bitcoin ETF products still successfully attracted net daily inflows of 3,781 BTC, worth $243.49 million. When looking at a wider timeframe, the seven-day inflows crossed 9,034 BTC, valued at $581.79 million. While retail traders are bored of seeing the price stay in place, institutional players are apparently busy continuing to hoard coins.
As reported by Cointelegraph.
Also read: Apa Itu Bitcoin Halving?
Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
