Bitcoin (BTC) price drops below $98K as strong US economic data leads to $300M USD bullish cryptocurrency liquidation

Cryptocurrency markets faltered with Bitcoin (BitcoinThe $100,000 level was lost on Tuesday morning in the US as two editions of stronger-than-expected US economic data threw cold water on the digital asset’s bright momentum at the start of the year.

Bureau of Labor Statistics JOLTS Jobs for November It rose unexpectedly to 8.1 million from 7.8 million the previous month, easily beating analysts’ estimates of a decline to 7.7 million.

Released at the same time, the ISM Services Purchasing Managers’ Index, a monthly gauge of the level of economic activity in the services sector, came in at 54.1 for December, beating expectations of 53.3 and well ahead of November’s 52.1. The prices paid sub-index came in strong at 64.4, compared to expectations of 57.5 and 58.2 in the previous month.

While neither report generally tends to be a major market mover, combined they created an additional jolt to an already jittery bond market, sending the 10-year US Treasury yield rising another five basis points to 4.68% and within a few days Minutes from multiple years. Elevations. The move sent US stocks lower, with the Nasdaq now down more than 1% in late morning trading and the S&P 500 down 0.4%.

Bitcoin, which traded just below $101,000 during European afternoon hours, fell to $97,800 after the data, giving up yesterday’s gains and falling 4% over the past 24 hours. Major altcoins fell further with Ethereum (ETH) and Solana’s SOL losing 6%-7%, while Avalanche’s AVAX and Chainlink’s AVAX fell 8%-9%.

The rapid decline in prices led to the liquidation of nearly $300 million of long positions across financial derivatives markets betting on higher prices, according to Bloomberg. Queen Glassmarking the first significant leverage inflow this year.

The strong data also prompted investors to lower their expectations for interest rate cuts in 2025.

While market participants had already ruled out any chance of a rate cut at the Fed’s January meeting, they now see only a 37% chance of an accommodative move at the central bank’s March meeting, down from nearly 50% just one week ago. . According to CME FedWatch. Looking further, the odds of a rate cut in May are now well below 50%. Surveying all of 2025, Kyle Chapman of the Ballinger Group noted that investors are now only pricing in one 25 basis point rate cut for the entire year.