Bitcoin moved above the $65,000 level on Monday as cryptocurrency markets extended their recent recovery, with investors turning their attention toward a crucial U.S. inflation report scheduled for later this week.
The world's largest cryptocurrency gained nearly 3% over the past seven days, supported by improving sentiment across global risk markets. A weaker-than-expected U.S. employment report released Friday helped ease concerns that the Federal Reserve may need to raise interest rates again, providing support for Bitcoin and other risk-sensitive assets.
However, the upcoming Consumer Price Index data could determine whether Bitcoin can maintain its latest momentum.
Bitcoin Returns Above $65,000
Bitcoin traded above $65,000 on Monday, extending a recovery that has gradually strengthened over the past week.
The move came as investors responded positively to softer U.S. employment data. Weakness in the labor market can reduce pressure on the Federal Reserve to maintain an aggressive monetary policy stance, which tends to benefit assets such as cryptocurrencies and equities.
Bitcoin was not alone in moving higher.
Ether traded around $1,919 and gained almost 3% over the week. BNB climbed to approximately $603, while Solana emerged as one of the strongest major cryptocurrencies, trading near $77 after rising almost 5% over seven days.
XRP was a notable exception. The cryptocurrency traded near $1.03 and declined approximately 4% over the week, leaving it behind the broader crypto market recovery.
Global Stock Rally Supports Risk Sentiment
Bitcoin's gains have developed alongside strength in traditional financial markets.
Global equities continued to perform strongly, with the MSCI All Country World Index extending its recent advance. Asian equities also moved higher after Friday's softer U.S. jobs report helped push the S&P 500 to a record level.
Semiconductor companies were among the strongest performers, further supporting risk appetite across global markets.
The relationship is significant for Bitcoin because the cryptocurrency frequently responds to changes in global liquidity, interest-rate expectations and investor appetite for risk.
When expectations for tighter monetary policy decline, investors may become more willing to increase exposure to higher-risk assets, including cryptocurrencies.
Oil and Treasury Yields Add Macro Uncertainty
Not every macroeconomic signal was supportive.
Brent crude oil rose around 1% to approximately $84.40 per barrel as geopolitical tensions involving Iran and the United States remained unresolved. Oil had gained more than 5% over three trading sessions.
Higher energy prices can potentially contribute to inflationary pressure, making the upcoming U.S. CPI report even more important for financial markets.
Meanwhile, the benchmark 10-year U.S. Treasury yield edged higher to around 4.66%, while the dollar strengthened against several major currencies.
Both rising bond yields and a stronger dollar can create headwinds for Bitcoin if the moves become significant.
U.S. CPI Becomes Bitcoin's Next Major Test
Investor attention is now shifting toward July's U.S. Consumer Price Index report, scheduled for release on Wednesday, August 12, at 8:30 a.m. Eastern Time.
The inflation report could influence expectations surrounding the Federal Reserve's next monetary policy decisions.
A softer inflation reading could strengthen expectations that policymakers will avoid additional rate increases, potentially supporting Bitcoin and other risk assets.
A hotter-than-expected CPI reading, however, could revive concerns about persistent inflation and increase expectations for tighter monetary policy. Such a development could pressure cryptocurrencies by pushing Treasury yields and the U.S. dollar higher.
Bitcoin Holds Firm Despite Technical Challenges
Bitcoin's recovery is also notable because the network's broader ecosystem has faced several technical and security-related issues recently.
The market has dealt with additional sweeps involving Coldcard-generated wallets, a critical BTCPay Server vulnerability affecting merchant Lightning nodes, and controversy surrounding the BIP-110 soft-fork attempt.
Despite these developments, Bitcoin has remained around the psychologically important $65,000 area, suggesting macroeconomic conditions currently have significant influence over market direction.
The next major catalyst is therefore likely to come from Washington rather than the crypto industry itself.
Wednesday's inflation report could determine whether Bitcoin builds on its latest recovery or retreats from $65,000 as traders reassess the outlook for U.S. interest rates.
