Bitcoin (BTC) price dipped below $66,000 during U.S. trading hours on Wednesday, late in the day, after several small gains were met with quick selling.
At $65,800 at the time of writing, Bitcoin has been flat over the past 24 hours. The broader CoinDesk 20 index fell 0.7%, dragged down by a 10% decline in Bitcoin Cash (BCH) and Litecoin (LTC).
On Wednesday, Bitcoin rose twice to around $66,500. The first move followed a weaker-than-expected report on U.S. service industry growth in March, and the second came after Federal Reserve Chairman Jerome Powell said the economy remained strong. This comes in response to the Bank's statement that it continues to expect interest rate cuts this year. Inflation and the economy.
Most of Bitcoin's rally in 2024 occurred from approximately mid-February to mid-March. This was at a time when spot ETFs were regularly adding between 5,000 and 13,000 Bitcoins each day, even though Grayscale's GBTC was selling heavily. However, since then, GBTC continues to see a massive sell-off in Bitcoin, while purchases into other ETFs have slowed. There are many days when the net inflow to the spot ETF group as a whole turns negative.
As a result, the price of Bitcoin has fallen by about 10% from the $73,500 it recorded on March 12th.
In addition to spot ETFs, another promising catalyst this year was easy monetary policy from the Fed. But economic indicators have crumpled much of that evidence.
After steadily receding throughout 2023, inflation actually started to rise in the first few months of 2024. The year-over-year increase in February was 3.2%, still well above the Fed's 2% target. At the same time, the economy appears to be growing steadily, with government statistics showing more than 200,000 jobs added every month so far this year and unemployment rates remaining near historic lows.
Earlier Wednesday, ADP reported private payrolls growth of 184,000 in March, higher than February's 155,000 and the expected 148,000. The main employment event will be the government's report on non-farm payrolls on Friday morning, which economists expect will rise by 200,000.
Recent strong economic data has pushed the US 10-year Treasury yield to a 2024 high of 4.43% and the US dollar to its strongest level since November of last year, both of which have put a damper on risk asset prices, including Bitcoin. There is a possibility that there is a tendency to
