Rebound Indicated by Bonds: Crypto Daybook Americas

By Omkar Godbole (Times are ET unless specified otherwise) The risk-off sentiment intensified during Asian trading hours as the price of bitcoin briefly dipped below $90,000 for the first time in seven months, before stabilizing around $91,000, marking a 4.5% decline over 24 hours. Major alternative cryptocurrencies such as XRP, BNB, and SOL also experienced a drop but performed better than the largest cryptocurrency. The majority of the top 100 coins are currently in the red, with a few exceptions like ASTER, HYPE, KYPE, and ICP. Some experts attribute the double-digit monthly decline of BTC primarily to fading expectations of a December interest-rate cut by the Federal Reserve. "The probability of a cut decreased from approximately 70% to 42% in about a week, exacerbated by the lack of other macro data points," according to market maker Wintermute. "[Fed Chair Jerome] Powell's backtrack on the almost certain December cut forced investors to examine individual FOMC member preferences, revealing that the cut was far from a consensus. The response was immediate: U.S. risk assets softened, and crypto, being the most sentiment-sensitive risk asset, was hit the hardest." However, there is a positive outlook. Data from ING indicates that open interest in bullish U.S. Treasury bond options has increased recently, signaling that traders are betting on higher prices and lower yields. This stance suggests they are anticipating weaker U.S. economic data, which could revive hopes for faster Fed rate cuts. ING noted that with only 15 basis points priced in for a December cut, there is significant room for front-end rates to spill over into the dollar. In other words, there is potential for renewed dollar weakness. For bitcoin bulls who have been battered this month, this outlook could signal a turning point. Historically, declining yields and a softer dollar have provided a favorable environment for a crypto rebound. The key question remains: When will this dovish repricing in Treasuries spill over to risk assets, enabling bitcoin and the broader crypto market to regain momentum? For now, the U.S. dollar index remains firm, poised to extend Monday's bounce from 99.00 and potentially retest the Aug. 1 swing high of 100.25, a level that acted as resistance earlier this month. Its approach and interaction with this key level will be crucial to watch. A clear breakout above 100.25 could increase pressure on risk assets. Stay alert! Read more: For analysis of today's activity in altcoins and derivatives, see Crypto Markets Today. What to Watch For a more comprehensive list of events this week, see CoinDesk's "Crypto Week Ahead". Token Events For a more comprehensive list of events this week, see CoinDesk's "Crypto Week Ahead". Conferences For a more comprehensive list of events this week, see CoinDesk's "Crypto Week Ahead". Market Movements Bitcoin Stats Technical Analysis Crypto Equities Crypto Treasury Companies ETF Flows Spot BTC ETFs Spot ETH ETFs Source: Farside Investors While You Were Sleeping