Bitcoin came under renewed selling pressure on September 11, falling into the mid-$76,000 range as surging oil prices, rising U.S. Treasury yields and growing expectations of a September Federal Reserve rate hike weighed on risk assets.
The cryptocurrency market is now looking toward the latest U.S. Consumer Price Index (CPI) report, with investors assessing whether the inflation data will strengthen or weaken expectations for monetary policy at the upcoming Federal Open Market Committee (FOMC) meeting.
Oil Prices and Treasury Yields Add Pressure
Bitcoin had climbed as high as $82,000 last Friday, matching its May recovery peak, before losing momentum following stronger-than-expected U.S. employment data.
Geopolitical tensions in the Middle East subsequently added to pressure on financial markets. Reports of escalating confrontations involving Iran, the United States and regional forces pushed oil prices higher, increasing concerns about renewed inflationary pressure.
Bitcoin briefly recovered to around $77,000 on Tuesday and moved close to $79,000 on Wednesday. However, continued geopolitical uncertainty, attacks linked to the Houthi movement and two consecutive days of net outflows from Bitcoin exchange-traded funds limited the recovery.
Oil prices then accelerated after reports that Houthi forces had seized the strategic port of Mocha near the Red Sea and that Saudi Arabia’s August crude production had fallen to its lowest level since 1990. Crude prices rose from roughly $95 to above $104, adding to concerns that higher energy costs could complicate the Federal Reserve’s inflation outlook.
The latest Producer Price Index (PPI) data also contributed to a rise in market expectations for a September rate hike, with the probability increasing to around 70%. Bitcoin subsequently slipped toward the mid-$76,000 range.
U.S. Treasury yields added another layer of pressure. The 10-year Treasury yield rose from 4.78% to 4.96% over two days as investors responded to higher oil prices, stronger inflation expectations and the latest economic data.
A Treasury buyback operation also drew attention after only $5.1 billion of the planned $6 billion was accepted. Some market participants argued that the weaker-than-expected participation reflected sellers demanding prices that the Treasury was unwilling to accept, suggesting that the resulting rise in yields may have been somewhat exaggerated.
CPI Becomes the Market’s Next Major Test
The latest CPI report is expected to be a key catalyst for Bitcoin and broader financial markets.
A hotter-than-expected inflation reading could reinforce expectations that the Federal Reserve will raise interest rates in September, potentially putting additional pressure on cryptocurrencies and other risk-sensitive assets.
A softer CPI reading, however, could challenge those expectations and trigger a rapid recovery in Bitcoin.
The PPI report offered a mixed signal. Although the headline figure was 0.1 percentage point above expectations, the core month-over-month reading was 0.1 percentage point below forecasts. Nevertheless, the overall 5.4% figure appeared to have a psychological impact on investors.
PPI measures prices received by producers and can provide clues about future inflation, but higher producer costs do not automatically translate into higher consumer prices. Weak consumer demand, for example, can limit the extent to which businesses pass increased costs on to customers.
That makes the CPI reading particularly important for determining whether inflationary pressure is actually reaching consumers.
Bitcoin’s Technical Picture Remains Mixed
Despite the recent decline, investor sentiment across the cryptocurrency market remains relatively strong.
The Crypto Fear & Greed Index rose to 70 from 66, keeping the market firmly in “Greed” territory. The reading suggests that investors remain broadly optimistic despite the recent pullback.
Bitcoin has spent roughly two weeks trading within a relatively narrow range while attempting to defend support around $77,000. Although geopolitical tensions and rising energy prices have encouraged some investors to reduce exposure to risk assets, Bitcoin’s ability to remain near key technical levels indicates that demand has not disappeared.
From a technical perspective, Bitcoin remains above several important exponential moving averages, keeping the broader bullish structure intact.
The Relative Strength Index (RSI) has fallen from previously overbought levels to around 58. That indicates that buying pressure has cooled but remains modestly positive.
The Moving Average Convergence Divergence (MACD), however, is showing increasingly negative momentum, pointing to weakening upside strength in the short term.
The $77,000 area remains an important near-term support level. Below it, Bitcoin’s 200-day EMA around $72,900 and 50-day EMA near $72,800 form a closely grouped support zone.
The 100-day EMA around $70,700 represents another major technical level. A decisive break below that area could signal a more significant deterioration in Bitcoin’s broader trend.
Clarity Act Faces Political Hurdles
Regulatory developments are also being closely watched by cryptocurrency investors in the United States.
Treasury Secretary Scott Bessent has called for the passage of the Clarity Act ahead of a committee vote scheduled for September 15. However, an amendment introduced by Senator Cynthia Lummis reportedly does not contain ethics provisions that Democrats had identified as important, potentially making bipartisan support more difficult.
The Clarity Act is intended to establish a clearer regulatory framework for digital assets in the United States. Its progress could have significant implications for cryptocurrency exchanges, digital-asset companies and the broader market.
CPI and Fed Decision to Set the Next Direction
Bitcoin’s next major move is likely to depend heavily on inflation data and expectations surrounding the Federal Reserve.
A cooler-than-expected CPI reading could reduce the likelihood of a September rate hike and provide Bitcoin with room to recover toward recent highs.
Conversely, stronger inflation data could reinforce expectations for tighter monetary policy, support higher Treasury yields and increase pressure on Bitcoin.
For now, the $77,000 support level remains critical. Whether Bitcoin holds that area or breaks toward the $72,000-$70,700 zone could determine whether the current decline remains a normal correction or develops into a deeper market reversal.
