August 12 — a fork in the road for bitcoin: the inflation report will decide the market's fate
This week, the cryptocurrency market is frozen in anticipation of a key macroeconomic trigger. The release of July US inflation data, scheduled for August 12, will be the moment that determines the trajectory of Bitcoin's movement over the coming weeks. The question is stark: will the Fed manage to hold its pause and not raise rates in September, or is monetary policy tightening inevitable?
The labor market has cracked
The starting point for revising expectations was fresh employment data, which came in significantly worse than forecasts. In July, the US economy lost 23,000 jobs, although the market had expected growth. The unemployment rate meanwhile fell to 4.1%, but the main signal lies in the revision of previous months: the combined picture for May and June deteriorated by approximately 103,000 jobs. This is not a one-off glitch, but a sustained trend of labor market cooling.
The market's reaction was swift: the probability of a September rate hike collapsed from 55% to 41%. A weak labor market is an argument for a "dovish" Fed stance, but inflation remains the stumbling block.
Three scenarios for inflation
The consensus forecast for July inflation is around 3.4% year-over-year, with a core reading of 2.2%. However, risks are skewed to the upside due to instability in oil prices: June's decline in gasoline prices has given way to a new round of volatility. I see three possible developments:
• Below forecast. Bond yields will move lower, which would be a powerful catalyst for the technology sector and cryptocurrencies. This is precisely the scenario that opens the door for Bitcoin to reach $70,000.
• Within expectations (around 3.4%). Short-term volatility without a change in the overall picture. The odds of a September hike will remain balanced, and the market will wait for new signals.
• Acceleration to 3.5–3.6% or higher. This is the worst-case scenario for risk assets: yields will rise, and both tech giants and Bitcoin will come under pressure.
The historical correlation is obvious: when inflation came in below forecasts (February, April, July), markets received support — the Nasdaq rose, and Bitcoin climbed from $62,000–63,000 to $64,000 and above. Conversely, exceeding expectations in May triggered a rise in yields and a crash in cryptocurrencies.
Oil, SpaceX, and Bitcoin: the balance of power
The geopolitical backdrop remains tense. Negotiations over the Strait of Hormuz have reached a deadlock: Iran demands the lifting of sanctions, while Washington insists on the reverse sequence. Brent oil has returned to $83, WTI is consolidating above $75 — this adds to pro-inflationary risks.
The situation with SpaceX deserves special attention. The company's shares rebounded sharply after a two-day decline, despite the release of about 911 million unlocked shares. The reason is a strong quarterly report with revenue of $7.8 billion, although capital expenditures of $18.4 billion and negative free cash flow point to a tilt toward AI infrastructure. I see potential for a 10–15% correction into the $108–114 zone.
As for Bitcoin, I view the current rebound as a false rally. The accumulation of liquidity above and the return of local confidence will likely give way to a new wave of decline toward $60,000 and below. I have already closed my long position from $58,000 and am considering a short in the $65,000 area upon confirmation of seller pressure.
My verdict: August 12 is not just a date on the calendar, but a fork in the road that will set the tone for all of September. Ahead of the data release, I expect heightened volatility in both stocks and cryptocurrencies, with it being more pronounced in the stock market. Investors should be prepared for sharp moves in both directions.