Will the Fed focus on breakevens, which are already at 2% or less on the short end, or on growing consumer concerns?
The Federal Reserve itself tends to rely on break-even points because they reflect institutional capital allocation, while consumer surveys often lag and can be heavily influenced by volatile everyday costs like energy and food. Therefore, the argument that falling breakevens are bullish for Bitcoin remains valid.
But the central bank may not completely ignore broad sentiment, which may be self-reinforcing, especially if catalysts like energy prices remain volatile.
And guess what? The ceasefire between the United States and Iran has failed. The two sides exchanged airstrikes earlier today, leading to a roughly 5% rise in benchmark oil prices. Bitcoin has fallen back to $62,000 and may fall further if panic spreads to Wall Street later today.
Analysts are also keeping an eye on the minutes of the Federal Reserve’s June meeting, which will be released later today.
“Wednesday’s Fed minutes are the icing on the cake. With long positions so crowded and funding this rich, an aggressive read is exactly the spark that ignites leverage, and the Strategy’s authorization hangs over every rally. We respect the bounce, we don’t trust it, and we keep the size honest in the minutes,” Marex analysts said in an email.
