August 12 — the day that will decide bitcoin's fate: why the inflation report matters more than any halving
The release of July U.S. inflation statistics, scheduled for August 12, will be a key trigger for the entire digital asset market. These figures will determine whether the Federal Reserve decides to raise the key interest rate as early as September. This decision directly impacts whether Bitcoin can hold above the $70,000 mark or if we will see another deep plunge.
Fresh labor market data has already significantly adjusted investor expectations. In July, the U.S. economy lost 23,000 jobs, although the consensus forecast had predicted growth. The unemployment rate fell to 4.1%, but a far more alarming signal was the massive revision of data for May and June—combined figures were downgraded by approximately 103,000 jobs. This is not a one-off glitch but a sustained trend toward a cooling labor market. As a result, the probability of a September rate hike has collapsed from 55% to 41%.
Three scenarios for the market
The key question is what July inflation will turn out to be. The consensus suggests around 3.4% year-over-year with a core reading of 2.2%. However, there is an important nuance: the oil factor is becoming unstable again. In June, gasoline prices fell sharply, providing a disinflationary effect, but by July, the fuel component began to pressure the statistics once more.
I see three possible developments. If the data comes in below forecasts—bond yields will decline, and the technology sector and cryptocurrencies will benefit first. If the figures match expectations—we will see short-term volatility without a change in the overall picture, and the chances of a September hike will remain balanced. But the most dangerous scenario is inflation accelerating to 3.5–3.6% and above. In that case, yields will surge, and all risk assets, including Bitcoin, will come under pressure.
The worst combination for the regulator is a weak labor market alongside high inflation. Raising rates in such a situation is dangerous for the economy, but ignoring rising prices is impossible. The historical correlation here is obvious: when inflation data came in below forecasts (in February, April, and July), markets rose—Nasdaq gained more than one percent, and Bitcoin jumped from $62,000–63,000 to $64,000 and higher. But on May 12, when inflation exceeded expectations, yields soared, and cryptocurrencies came under heavy pressure.
My base forecast is that the data will match expectations, but the market will read it negatively. To remove the threat of a rate hike, sustained inflation declines are needed in both August and September. One report alone is not enough.
Oil, SpaceX, and Bitcoin: the balance of power for the week
On the geopolitical front, the situation remains tense. Iran and Oman are working on a plan for the phased opening of the Strait of Hormuz, but the U.S. opposes expanding Iranian control over shipping. Oil has already reacted with gains: Brent has returned to $83, WTI is consolidating above $75. On a pullback to $74, I am considering a long position with a target of an 8–10% move.
Special attention deserves the situation with SpaceX shares. After a two-day decline, the stock sharply rebounded, although about 911 million unlocked shares hit the market—more than the initial free float after the IPO. The reason for the rebound is the pre-priced expectations of a sell-off, short covering, and a strong report with quarterly revenue of $7.8 billion. However, capital expenditures amounted to roughly $18.4 billion, free cash flow remains negative, and the space segment is unprofitable. The main stable cash flow is provided by Starlink. The unlock is not complete—the next tranche is scheduled in 70 days. I am considering a short position with a target of a 10–15% correction into the $108–114 zone.
As for Bitcoin, I interpret the current rebound as a false rally. Liquidity accumulation at the top, a return of local confidence, and then a new wave of decline toward $60,000 and below. I have already fully closed my long from the $58,000 area and am looking for a short entry point in the $65,000 zone. The trigger will be a halt in momentum, the formation of resistance, and confirmation of seller pressure. From Monday to Wednesday, before the inflation data release, I expect heightened volatility in both stocks and cryptocurrencies—with it being more pronounced in the equity market.
My verdict: August 12 is not just a date on the calendar but a bifurcation point for the entire market. Investors should prepare for sharp movements and avoid opening large positions until the data is released.