The price of bitcoin (BTC) has traded in an exceptionally tight trading range surrounding $68,000 in the days following the U.S. Memorial Day holiday, but declined to near the week's low in Friday morning trading hours.
At 11:45 am ET, bitcoin was changing hands at $67,300, lower by 1% over the past 24 hours and down by more than 2% from two hours earlier when it briefly rose above $69,000. The broader CoinDesk 20 was down 1.1% over the last day.
May, though, has been strong for bitcoin, which is now higher by 11% since beginning the month at around the $60,000 level. That's underperformed the CoinDesk 20's roughly 20% advance, fueled by a 31% gain in the price of ether (ETH) thanks to the surprising regulatory turnaround in the prospects for a spot ETF for that asset.
Macro conditions could provide next catalyst
This week's muted action in bitcoin – the price has essentially stayed in the $67,000-$69,000 range – came alongside struggles for other risk assets, U.S. stocks amongst them. While still remaining close to all-time highs, the Nasdaq is lower by about 2% this week, while the S&P 500 is off by roughly 1.5%.
U.S. economic data continued to have the scent of stagflation, with the April Core PCE Price Index up 2.8% year-over-year, in line with expectations and the same pace as the previous month. The May Chicago PMI plunged to 35.4 versus expectations for 41 and 37.9 in April. Only in the depths of the 2008/2009 global financial crisis and the March/April 2020 Covid lockdowns has May's weak read been matched. The bond market rallied following the news, with the 10-year U.S. Treasury yield down 5.5 basis points to 4.50%.
June begins Saturday and next week should bring a bit more clarity to the U.S. economic picture thanks to Monday's national PMI report and Friday's national employment report. Confirmation of softening economic conditions, and with those improved prospects for lower interest rates, might prove to be the catalyst for bitcoin's attempt at breaching its all time high above $73,000 set in March. Strong economic data, however, could mean a retest of the May lows.