Bitcoin Couldn’t Hold Above $85,000: Why Wasn’t Positive Inflation Data Enough?
Bitcoin climbed to $85,500 on lower-than-expected U.S. inflation data, then gave back most of its gains as Treasury yields remained elevated, retreating to around $83,700.
According to CoinDesk’s market review on the morning of October 1, Bitcoin was trading slightly above $83,700 in Asian trading, up 0.4%. Optimism sparked by the inflation data released the previous day was not enough to keep the price above $85,000.
Why didn’t Bitcoin’s rally last?
Dan Khus, Chief Analyst at LVRG Research, said the personal consumption expenditures (PCE) report for August pointed to a stronger-than-expected slowdown in inflation. According to Khus, this reduced the likelihood of the Fed raising interest rates again in October, putting December in focus for its next possible move.
Treasury yields initially fell after the data, and demand for risk assets increased. But sharp price movements on Wall Street erased much of Bitcoin’s gains. The U.S. 10-year Treasury yield stood at around 5.28%, near the previous day’s high. The 30-year yield stabilized around 5.62% after reaching its highest level since 2002 during New York trading.
Falling oil prices helped slow Treasury selling, while the dollar strengthened. The analysis highlights a sustained decline in the 10-year Treasury yield as key to Bitcoin holding on to its next rally.
HYPE stands out among altcoins as Solana falls
In the market snapshot from that same morning, HYPE rose 3% to around $89, outperforming leading altcoins. Dogecoin (DOGE) was up about 2%, trading just below $0.10.
Gains for Ethereum, BNB, TRX, and ZEC remained below 1%. XRP traded flat at around $1.50, while Solana (SOL) fell about 1% to just below $119.
Technology stocks painted a more positive picture in Asian equity markets. Nasdaq 100 futures rose 0.8%, while S&P 500 futures gained 0.4%. Japan’s Nikkei index rose 2.7% and South Korea’s Kospi index gained 1.2%, while Bitcoin failed to hold on to its sharp post-inflation-data rally.