Bitcoin below $30k after U.S. retail sales data

The retail sales report from the U.S. Census Bureau for June showed some weakness, with the headline number increasing 0.2 per cent last month compared to predictions for 0.5 per cent and May’s 0.5 per cent

Bitcoin’s price at $29,735 was barely staying above a one-month low after Tuesday’s economic data confirmed the U.S. economy remains in growth mode and traders prepare for what is now an almost certainty of another Federal Reserve rate hike next week.

Bitcoin, which seemed set for a big upside price breakout when it rallied to $31,800 in the past week, was 0.7 per cent lower over the past 24 hours and stands just below its $30,000 support of much of the past month.

Other top cryptocurrencies were mixed. Ether was recently changing hands at $1,893, flat from Monday. XRP, which surged and then dipped in the past week after a favourable court ruling in Ripple’s ongoing court case with the US Securities and Exchange Commission, was trading at 76 cents, over 4 per cent higher. But ADA, SOL and MATIC, the native cryptocurrencies of Cardano and Solana, were recently off 2 per cent, 3.6 per cent and 5 per cent, respectively.

On its face, the retail sales report from the U.S. Census Bureau for June showed some weakness, with the headline number increasing 0.2 per cent last month compared to predictions for 0.5 per cent and May’s 0.5 per cent. Nevertheless, the retail sales “control group” increased 0.6 per cent in June, more than double May’s pace and way ahead of projections for a 0.3 per cent drop.

Score another win for team soft landing, said Joseph Brusuelas, chief economist at RSM. He observed that the control group is 2.1 per cent higher on a 3-month average annualized basis, meaning moderate upside risk to his team’s prediction for 1.7 per cent Gross domestic product (GDP) growth in the second quarter.

What little doubt about the result of next week’s meeting of the Fed’s FOMC has been essentially completely erased, with traders now pricing in a 97.3 per cent possibility of another 25 bps rate hike, as per the CME FedWatch Tool.

Equity markets increased amid uplifting Q2 earnings from BoA and other leading financial services companies that continued a trend from last week when JP Morgan Chase reported significant gains in net income and revenues. The Nasdaq Composite and S&P 500 ended 0.7 per cent higher.