The US inflation report will decide bitcoin's fate: why August 12 is the key date of the month
The release of July U.S. inflation data, scheduled for August 12, will be the main trigger for the cryptocurrency market. This report will determine whether the Federal Reserve decides to raise the key interest rate in September, and thus whether Bitcoin can overcome the psychologically important level of $70,000.
Recent macroeconomic signals indicate that the regulator is in a difficult situation. The labor market, which had recently shown resilience, is beginning to send warning signs. The July employment report showed a loss of 23,000 jobs, although analysts had expected growth. The unemployment rate fell to 4.1%, but revisions to May and June data collectively worsened the picture by about 103,000 jobs. This is not a one-off glitch, but a steady trend toward cooling.
The market reacted instantly: the probability of a September rate hike fell from 55% to 41%. Now all attention is focused on consumer price figures. The consensus forecast suggests inflation of about 3.4% year-over-year with a core reading of approximately 2.2%. However, risks are skewed to the upside—the oil factor is becoming unstable again, which could push prices above expectations.
Three scenarios for the market
I see three possible scenarios. If the data comes in below forecasts, bond yields will fall, which would be a powerful catalyst for the technology sector and cryptocurrencies. If it matches expectations around 3.4%, the market will likely remain range-bound—short-term volatility will not change the overall picture. But the most dangerous scenario is inflation accelerating to 3.5–3.6% or higher. In that case, yields will surge, and both expensive technology stocks and Bitcoin will come under pressure.
The historical correlation here is clear. In February, April, and July, when data came in below forecasts, markets received support—Nasdaq rose and Bitcoin climbed from $62,000–63,000 above $64,000. Conversely, on May 12, when inflation exceeded expectations, yields moved up and cryptocurrencies came under pressure. For the Fed, the worst combination is a weak labor market and high inflation: raising rates is dangerous for the economy, but ignoring price growth is impossible.
My base case: 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, and judging by the dynamics of oil prices, we may not see that.
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 sanctions relief, while the U.S. insists on the reverse sequence. Brent has returned to $83, WTI is consolidating above $75. On a pullback to $74, I am considering a long position with an expected move of 8–10%.
The situation with SpaceX deserves special attention. Shares rebounded sharply after a two-day decline, 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 expectation of selling, short covering, and a strong report with quarterly revenue of $7.8 billion. However, free cash flow remains negative, the space segment is unprofitable, and only Starlink provides stable cash flow. The next unlock tranche is scheduled in 70 days—I see potential for a short position targeting a 10–15% correction into the $108–114 zone.
Regarding 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 under strong pressure. I have already fully closed my position from $58,000 and am looking for a point to short in the $65,000 area. The trigger will be a halt in momentum and confirmation of seller pressure. From Monday to Wednesday, before the inflation data release, I expect elevated volatility in both stocks and cryptocurrencies—it will be more pronounced in the equity market.
My professional view: August 12 is not just another piece of statistics, but a moment of truth for the entire risk asset spectrum. If inflation surprises to the upside, Bitcoin could lose 10–15% within days. Investors should determine their risk level in advance and not give in to emotions at the first moves.