$72,000 Within Reach... US Rate Cut Expectations Retreat [Bitcoin Now]

Wall Street Expected Premium, US Employment Data Plunge After Release
Bitcoin Momentarily Retreats to $68,000

Last week, the Bitcoin market, which was on a rising streak aiming for $72,000, cooled sharply on the 7th (local time) immediately after the release of the U.S. employment data. This was because the U.S. labor market was confirmed to be much stronger than Wall Street expectations, causing the Federal Reserve's (Fed) hopes for a rate cut within the year to retreat. Along with the value of the U.S. dollar, U.S. Treasury yields also rose simultaneously.

According to the global cryptocurrency market tracking site CoinMarketCap, as of 12:50 PM on the 8th (Korean time), the price of Bitcoin was $69,454.86, down 2.13% from the previous day. Compared to a week ago, it rose 2.64%, and compared to a month ago, it increased by 10.43%. The year-over-year increase rate stands at 164.02%.

Bitcoin prices showed a gradual upward trend over the past week after starting at the $67,000 level on the 2nd. On the 7th, it even surpassed $71,000, raising expectations for a new all-time high. The intraday highest price reached $71,918.97. However, it turned into a sharp decline in the early hours of the 8th, falling to $68,000 within about two hours. As of now on the same day, it remains below $70,000.

The decline in Bitcoin prices on the 8th is interpreted as a result of the retreat in expectations for a U.S. rate cut along with the sharp rise in interest rates and the dollar value. Initially, the market had highly anticipated a rate cut possibility in September. Cryptocurrency specialist CoinDesk analyzed, "The government's May employment report turned out to be much stronger than expected," adding, "After an increase of 272,000 jobs, cryptocurrencies began to decline from the U.S. morning hours."

The U.S. Department of Labor announced on the 7th (local time) that nonfarm payroll employment increased by 272,000 in May. This significantly exceeded the expert forecast of 190,000 jobs compiled by The Wall Street Journal (WSJ). The April nonfarm payroll figure was revised down from an initial 175,000 increase to 165,000. The U.S. unemployment rate for May was 4.0%, higher than the previous month's 3.9%.

In fact, after the employment data was released, U.S. Treasury yields surged. The 10-year U.S. Treasury yield reached 4.432%, up 14.90 basis points (1 bp = 0.01 percentage point) from the reference price at 3 PM on the 7th (New York time). The 2-year yield, which is sensitive to monetary policy, jumped 15.00 basis points during the same period, and the 30-year Treasury yield also rose by 11.80 basis points.

According to cryptocurrency data provider Alternative, the Fear & Greed Index, which indicates investor sentiment as of that day, was 72 points (Greed). This is the same as last week's 72 points (Greed). Alternative's Fear & Greed Index means that a score closer to 0 indicates extreme fear and pessimism about investing, while a score near 100 indicates optimism.