Bitcoin and major altcoins have begun a recovery after last week’s sharp decline triggered by macroeconomic data, and investors are reentering the markets with cautious optimism.
Bitcoin Nears $115,000: Investors Are “Cautiously Optimistic” and Buy on the Dip
Bitcoin rose 1.22% in the last 24 hours to $114,738. The world’s largest crypto asset had fallen from $119,000 on July 31 to $111,800 on Saturday.
Similar price movements were observed in altcoins, with Ethereum rising 3.12% to $3,549, XRP rising 6.32% to $3, and Solana rising 1.66% to $163.69.
Presto Research analyst Min Jung attributed the decline to a “risk-off” trend that emerged after July’s US nonfarm payroll data fell short of expectations. The data showed that only 73,000 jobs were created in the US in July, well below expectations. Jung said the weak data and the decline in US stock markets triggered profit-taking in the crypto market after weeks of bullish activity.
BTSE COO Jeff Mei stated that the declines were short-lived and that long-term investors and institutional buyers were quick to seize the opportunity: “With recent acquisitions by crypto treasury companies and the expansion of crypto services by traditional financial institutions, we expect Bitcoin’s monthly closes to be increasingly higher.”
The market is “cautiously optimistic” The balance between macro uncertainty and institutional bullish expectations has investors in a “cautiously optimistic” position, according to Kronos Research CIO Vincent Liu. Liu highlighted the Fear & Greed Index’s shift toward “greed,” strengthening market sentiment.
Liu stated that investors are focusing on the July US Consumer Price Index (CPI), which will be released on August 12. This data is expected to have a significant impact on the Fed’s next interest rate decision.
The US Federal Reserve (Fed) held interest rates steady at its FOMC meeting on July 29-30, with Chairman Jerome Powell stating that a September rate cut was not a certainty. Data from the CME Group’s FedWatch Tool indicates an 80.8% probability of a 25 basis point rate cut at the meeting on September 17.
Liu also predicts that the US Securities and Exchange Commission’s (SEC) recently announced “Project Crypto” initiative will positively impact markets in the long term: “The project will modernize regulations by clarifying token classifications and introducing an innovation exemption for DeFi. This clarity could accelerate DeFi growth, reduce uncertainty, and increase market confidence.”
*This is not investment advice.