Bitcoin Targets $70,000 on Soft US Economic Landing Signals
While XRP remained pegged below $0.55, BTC attempted to break above the crucial $70,000 level. US labor market data and Services PMI figures boosted expectations for a soft US economic landing. The data also raised bets on multiple Q4 Fed rate cuts, driving BTC demand.
Initial jobless claims fell from 242k (week ending October 12) to 227k (week ending October 19). Tight labor market conditions could support wage growth, fueling consumer spending and demand-driven inflation.
Additionally, the US S&P Global Services PMI increased slightly from 55.2 in September to 55.3 in October, signaling a resilient US economy.
S&P Global Market Intelligence Chief Business Economist Chris Williamson commented on the October numbers, stating,
“October saw business activity continue to grow at an encouragingly solid pace, sustaining the economic upturn that has been recorded in the year to date into the fourth quarter. The October flash PMI is consistent with GDP growing at an annualized rate of around 2.5%.”
Nevertheless, the upbeat economic data failed to spook investors. The October Flash survey revealed slower inflation rates for input costs and prices charged. Prices charged fell to their lowest since May 2020, attributed to a sharp cooling of service sector inflation.
As a key driver for headline inflation, softer service sector inflation boosted bets on a December Fed rate cut. According to the CME FedWatch Tool, the chances of a 25-basis point December Fed rate cut increased from 66.2% on October 23 to 73.0% on October 24.
US BTC-Spot ETF Market Eyes $1 Billion Weekly Inflows
On Wednesday, the US BTC-spot ETF market reported total net inflows of $192.4 million. iShares Bitcoin Trust (IBIT) continued to lead the way, with net inflows of $317.5 million.
The US BTC-spot ETF market eyes a two-day inflow streak on Thursday, October 24, as investors await IBIT flow data. Rising bets on Fed rate cuts in November and December boosted demand for BTC-spot ETFs. According to Farside Investors,
- Bitwise Bitcoin ETF (BITB) had inflows of $29.6 million. (Previous Day: -$25.2 million).
- Grayscale Bitcoin Trust (GBTC) saw net outflows of $7.1 million. (Previous Day: zero net flows).
Excluding flow data for IBIT, the US BTC-spot ETF market reported net inflows of $22.5 million. While inflows, excluding IBIT, are modest, another surge in demand for IBIT would set the BTC-spot ETF market for a second consecutive week of net inflows exceeding $1 billion for the first time since July.
Bloomberg Intelligence Senior ETF Analyst Eric Balchunas remarked on the US BTC-spot ETF market flows, stating,
“Not yet 10mo old and the ETFs are 97% of the way to holding 1 million btc, and 87% of the way to passing Satoshi as biggest.”
Balchunas shared a top bitcoin holders table that showed Satoshi Nakamoto holding 1.1 million BTC. On a standalone basis, BlackRock (BLK) was third, holding 669,219 BTC. However, the US BTC-spot ETF market had a combined 967,793 BTC, ranking it second.
Bitcoin (BTC) Price Action
On Thursday, October 24, BTC advanced by 2.28%, reversing a 1.09% loss from the previous session to close at $68,165.
On Friday, October 25, the US Presidential Election, US economic data, and US BTC-spot ETF market flow trends require consideration.
A break above $70,000 could signal a move toward the all-time high of $73,808.
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