Bitcoin Rebounds: $80,000 Hopes Tested by Interest Rate Hike Risks

Bitcoin is rebounding from levels near its $76,350 cost basis, carrying two-way risks between the $68,000-$75,000 range and $80,000 ahead of upcoming employment data.

After retreating to $76,400 during the Asian session, Bitcoin climbed back above $77,600. With a 24-hour gain of approximately 1.5%, the price found buyers in a zone very close to the average purchase cost of active investors. According to Bitfinex analysis cited by CoinDesk, this cost basis sits at the $76,350 level.

Bitcoin’s move to within $50 of this level saw investors who were reluctant to sell at a loss throughout the week closing positions at their break-even point. Analysts noted that selling pressure from investors who bought in February and March was absorbed in this region.

Employment data could determine Bitcoin’s direction

Market expectations for the U.S. Federal Reserve (Fed) have also shifted. According to CME FedWatch data, the probability of an interest rate hike on September 16 rose to over 62%, up from approximately 37% a week ago. The rate was over 67% just a day earlier. Futures markets are not expecting a rate cut at the September meeting.

Attention is now focused on the non-farm payrolls data to be released on September 4. This will be followed by consumer inflation data (CPI) on September 11 and the Fed decision on September 16. In options trading, downside protection for this period is concentrated in the $68,000-$75,000 range.

Weak employment data could strengthen the likelihood of Bitcoin retesting the $80,000 level by reducing interest rate hike expectations. Conversely, strong data could increase pressure on rates, bringing the lower price range back into play. XRP was the day’s top performer among major cryptocurrencies with a nearly 3% gain, while Ether remained below $2,400.