Crypto Holds Steady as Equities Rally on Fed Rate Cut Hopes

U.S. equities extended gains on expectations of rate cuts following a weak jobs report, but crypto markets remained flat. Investors are now watching Thursday’s inflation print as the next key catalyst.

Bitcoin and Ether Stay Resilient as Markets Eye Inflation Data

U.S. equity futures climbed higher this week after August’s Nonfarm Payrolls (NFP) report showed just 22,000 new jobs, far below expectations of 75,000. The disappointing figure reinforced concerns over a slowing labor market and bolstered bets on Federal Reserve rate cuts, with traders now pricing in 72 basis points of easing before year-end.

According to QCP’s Sept. 8 market insights, treasuries rallied alongside stocks, with 2-year yields hitting new lows, while gold pushed to fresh highs. Yet the optimism has not carried over to crypto. Bitcoin remains above $110,000, and ether continues to trade over $4,250 even after five straight days of ETF outflows.

That stability has split opinion. Some analysts see the sideways trading as a sign of resilience, while others argue it reflects hesitation ahead of this week’s inflation data. Derivatives markets appear to lean bearish, with risk reversals showing increased demand for downside protection in September.

Volatility is expected to stay elevated into Thursday’s Consumer Price Index (CPI) report, where a hotter-than-expected print above 0.3% could complicate the Fed’s policy path. Tariffs add a layer of uncertainty, though most believe the Trump administration is unlikely to escalate trade tensions in the current environment.

For now, crypto appears well-supported but directionless, with traders looking to macro data for the next decisive move.

Key events this week: Wednesday – U.S. PPI; Thursday – CPI, Unemployment Claims