The price of Bitcoin (BTC) remained below $66,000 late in the day during U.S. trading hours on Wednesday after a few modest rallies were met with quick selling.
At press time, Bitcoin was flat at $65,800 over the past 24 hours. The broader CoinDesk 20 index fell 0.7%, hurt by 10% declines in Bitcoin Cash (BCH) and Litecoin (LTC).
Bitcoin managed two rallies to around $66,500 on Wednesday. One move followed a weaker-than-expected report on March growth in the U.S. services industry and another after Federal Reserve Chairman Jerome Powell said he expected continued rate cuts this year, despite continued buoyancy in both Inflation as well as the economy.
Most of the Bitcoin rally in 2024 took place roughly from mid-February to mid-March. At the time, spot ETFs were regularly adding 5,000 to 13,000 Bitcoins daily, even with significant sales by Grayscale's GBTC. Since then, however, GBTC has continued to make large Bitcoin sales while purchases in other ETFs have slowed. On many days, net inflows into the entire spot ETF group have turned negative.
At the same time, Bitcoin price is down about 10% from its record high of almost $73,500 on March 12.
Another hoped-for catalyst in addition to spot ETFs this year was the Fed's looser monetary policy. However, economic indicators have undermined much of these arguments.
Inflation, which had been steadily declining throughout 2023, has actually increased in the first few months of 2024. At 3.2% year-on-year in February, it remains well above the Fed's 2% target. Additionally, the economy appears to be continuing to grow steadily, with more than 200,000 new jobs added each month so far this year and the unemployment rate remaining near historic lows, according to government statistics.
Earlier Wednesday, ADP reported a rise in private payrolls of 184,000 in March, beating February's 155,000 and expectations of 148,000. The biggest jobs event will be the government's Nonfarm Payrolls report on Friday morning, with economists expecting 200,000 new jobs.
Recent strong data has pushed the 10-year U.S. Treasury yield to a 2024 high of 4.43% and the U.S. dollar to its highest level since last November – both of which could drive prices of risk assets including Bitcoin. tend to dampen.
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