Bitcoin Holds Near $84K as Consumer Confidence Drops Sharply

Consumer Confidence Drops Sharply in September

The Conference Board’s Consumer Confidence Index dropped 6.7 points to 81.9 in September from 88.6 in the previous month, marking its lowest reading since April 2014. Economists had expected a modest increase to 89, but rising interest rates and higher gasoline prices appear to have weighed on sentiment.

The Expectations Index also declined, falling 5.9 points to 63.6 and marking its third straight monthly drop.

Dana Peterson, chief economist at The Conference Board, said consumer confidence weakened noticeably in September after deteriorating over the previous two months. Consumers’ views of current business conditions turned negative for the first time since September 2024, while perceptions of the labor market also weakened but remained positive.

Looking ahead, consumers expect both business conditions and labor-market conditions to deteriorate over the next six months. Household income expectations remained positive, although consumers were less confident about future income growth than in previous months.

On Polymarket, contracts tied to a Democratic sweep of both the Senate and House were trading near their contract highs at 62%, while the odds of a Republican sweep stood at 8%.

Job Openings Signal Some Labor-Market Weakness

Separate government data showed U.S. job openings fell to 7.079 million in August from 7.335 million in July. The figure also came below economists’ forecast of 7.23 million.

Although the JOLTS report is backward-looking, the decline represents one of the first recent labor-market readings to show a notable warning signal.

Markets are now looking ahead to Friday’s September Nonfarm Payrolls report. Economists expect payrolls to increase by 129,000, while the unemployment rate is forecast to remain at 4.1%.

Oil Prices Pull Back

WTI crude fell more than 3% over the previous 24 hours, moving toward $90 a barrel for the first time in a week.

The benchmark had climbed as high as $106 in mid-September. Since the war in the Middle East began in February, WTI crude has spent much of the year trading between $70 and $100 a barrel.

Bitcoin Futures Leverage Falls

Bitcoin futures open interest has dropped to a year-to-date low, with outstanding contracts totaling about 628,000 BTC. That compares with 763,000 BTC at the start of August, according to CoinGlass data.

Bitcoin was trading around $63,000 at the beginning of August before climbing to as high as $87,500 in mid-September.

As traders enter the fourth quarter, historically Bitcoin’s strongest quarter, leverage in the futures market is lower while retail participation remains subdued.

Bond Market Sentiment Shifts

Jim Bianco, founder of Bianco Research, described bonds as a value opportunity, saying he would continue buying if yields moved higher.

Bianco said investors remain highly bearish on the bond market and argued that yields around 5.2% provide a substantial cushion for bond buyers.

The duration of the WisdomTree Bianco Total Return Fund, which he oversees, has increased to more than six years, compared with 5.7 years for the Bloomberg U.S. Aggregate Bond Index.

Bianco had previously argued for months that the Federal Reserve made a significant policy error when it began its easing cycle in September 2024. He pointed to the continued rise in bond yields as evidence, noting that long-term yields moved higher even as short-term rates were reduced.

With the Fed now in tightening mode and long-dated yields significantly higher, Bianco said conditions could be developing for a recovery in the bond market.

Credit Spreads Start to Widen

Credit spreads, which had remained relatively tight, have also begun to move wider.

The Federal Reserve had viewed narrow credit spreads as one indication of strength in the U.S. economy. Fed Chair Kevin Warsh and other officials had noted that the limited gap between yields on different grades of corporate debt suggested investors had little concern about the economic outlook.

That picture has shifted over the past two weeks. Bespoke reported a notable widening between investment-grade and high-yield corporate bonds.

Australia Raises Interest Rates

The global rate-hiking cycle continued Tuesday as the Reserve Bank of Australia lifted its cash rate by 25 basis points to 4.60%.

The move marked the RBA’s fourth rate increase this year and pushed its policy rate to the highest level since 2011. Australia joins the Federal Reserve, Bank of Japan and European Central Bank in raising rates as bond yields continue to climb globally.

Bitcoin Rebounds Above $84,000

Bitcoin gained about 1% on Tuesday to trade slightly above $84,200 after finding support near $82,500. The move came as the 10-year U.S. Treasury yield held around 5.25%, following Monday’s rise to its highest level since 2007.

Ether gained 2% to nearly $2,720, while DOGE advanced 3% and XRP added 2%. BNB, SOL and TRX each rose less than 1%, while HYPE slipped 1%. ZEC was the biggest laggard among the major tokens, falling 9% to roughly $1,423.

U.S. spot Bitcoin ETFs recorded about $31 million in net inflows Monday, while Ether ETFs attracted roughly $17 million, according to SoSoValue. SOL and XRP funds together added another $17 million. The only U.S. ZEC fund reported a net outflow, losing about $8 million.

Alex Kuptsikevich, chief market analyst at FxPro, said cryptocurrencies were cautiously recovering from last week’s lows near $2.83 trillion but remained in a short-term downtrend while the total market capitalization stayed below $2.90 trillion.

He also pointed to a stronger U.S. dollar and uncertainty in equity markets as additional sources of pressure.

Kuptsikevich said Bitcoin appeared to have found support around previous highs after cooling from its earlier rally. He added that sustained bullish sentiment could open the way toward new multi-month highs above $87,000.

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