Bitcoin slid more than $2,000 on Monday, dropping to just under $77,000 after US-Iran military action rattled global markets. The move leaves crypto traders bracing for a week of US economic data that could decide whether the Federal Reserve raises rates again in September.
The drop
The selloff came as geopolitical tensions escalated, though the exact nature of the military action wasn't immediately clear. Bitcoin's slide mirrors a broader risk-off tone across assets, with investors reaching for safety. The cryptocurrency had been trading above $79,000 earlier in the session before the news hit, according to market data.
A packed data week
The economic calendar is heavy. Tuesday brings July JOLTS job openings and the August ISM manufacturing PMI. Wednesday has the ADP private employment report. Thursday adds weekly jobless claims and the ISM services PMI. Friday closes with the August employment report, the most closely watched of the bunch.
Economists expect JOLTS openings to slip to around 7.27 million from 7.36 million. The July employment report showed a loss of 23,000 jobs, and unemployment is expected to hold at 4.1% for August. Forecasters look for the US to add roughly 58,000 jobs in August.
What the numbers could mean
The stakes are high for Bitcoin. A stronger-than-expected labor market could reinforce expectations of a rate hike, which is typically bearish for risk assets like crypto. A weaker report could reduce those expectations and give the market some relief. But a sharp deterioration could raise recession concerns and trigger a risk-off reaction, which would likely hit Bitcoin too.
Fed meeting ahead
The Federal Reserve's September meeting is scheduled for September 15-16. The jobs data this week will feed directly into that decision. If the labor market holds up, the case for another hike strengthens. If it cracks, the Fed may have to rethink its path.
Friday's employment report is the last major input before the Fed sits down. Until then, Bitcoin's direction may hinge on each data point.
