Bitcoin’s value dipped to approximately $106,000 as traders exercise caution in anticipation of significant U.S. economic data announcements. The overall cryptocurrency market too, experienced a decline over the last 24 hours.
Bitcoin’s price came down by 1%, settling at $106,013, while Ethereum’s ether lost 2.5% to trade at $2,423, as per the price page of The Block. The GMCI 30 index of The Block, which tracks the performance of the top 30 cryptocurrencies, also saw a 2% drop.
“The markets are currently in a cooling consolidation phase as traders await clarity from the upcoming jobless claims data set to be released on July 3, or a broader macro resolution,” stated Vincent Liu, CIO of Kronos Research. Liu also mentioned that “liquidity is currently weak, and positioning remains patient.”
According to Nick Ruck, the director of LVRG Research, Bitcoin’s price drop can be attributed to traders derisking ahead of crucial U.S. economic data releases. The passing of President Trump’s tax bill in the Senate has also raised concerns about the U.S. deficit and the bill’s effectiveness.
On Tuesday, the Senate passed President Trump’s tax bill, which aims to cut taxes by trillions of dollars while reducing spending on Medicaid, among other measures. However, a crypto tax provision, which was strongly supported by industry advocates, was not included in the final package.
Later in the day, the U.S. is set to release a host of labor market data, including May job openings from the U.S. Job Openings and Labor Turnover Survey, along with June non-farm payrolls and the unemployment rate.
“The macro data and the progress of Trump’s tax bill in Congress will be key drivers of overall risk-asset prices, including cryptocurrencies,” said Peter Chung, head of research at Presto Research.
Chung also mentioned that it is important to monitor the liquidity conditions as “there are early signs that we may potentially see significant improvement.”
While the crypto market remains down, Chung advised not to “read too much into these price moves.” He said, “They might seem enormous by traditional finance standards, but not for crypto. A good rule of thumb is to scale down crypto price moves by a factor of five, which then becomes comparable to the equity market.”
Disclaimer: The Block is an independent media outlet that provides news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry.
