The crypto market continued to pull back today, July 30, after the U.S. published strong economic data ahead of the Federal Reserve interest rate decision.
Summary
- The crypto market is down today after the US published strong GDP and jobs data.
- These numbers came before the Federal Reserve interest rate decision.
- Bitcoin price has formed a bullish pennant pointing to a strong rebound.
Bitcoin price remained inside the narrow range of $118,000, while most altcoins plummeted. Conflux (CFX), which surged on Tuesday, was one of the top laggards, dropping by 27%.
Bonk (BONK) price plunged by 14%, while other popular meme coins like SPX6900 (SPX), Floki (FLOKI), and Dogwifhat (WIF) fell by over 10%. Altogether, the market capitalization of all cryptocurrencies dropped by 1.65% to $3.84 trillion.
Crypto market is down ahead of FOMC decision
The cryptocurrency market pulled back after the U.S. released strong economic data, raising concerns about the Federal Reserve’s tone when it delivers its interest rate decision later.
A report by ADP showed that the economy added 104,000 jobs in July after shedding 23,000 in the previous month. The job addition was much higher than the expected 75,000.
Another report showed that the economy staged a strong comeback in Q2, rising by 3%. This marked a significant improvement following the economy’s 0.5% contraction in Q1.
Therefore, these numbers mean that the Federal Reserve may deliver a hawkish tone when it completes its two-day meeting later. In this scenario, the bank will leave rates unchanged and hint that it will not be in a hurry to cut rates as U.S. President Donald Trump has pushed.
Crypto crash accelerated amid trade jitters
The crypto market also crashed amid the rising trade jitters as the August 1 deadline nears. In a statement, Trump said that the U.S. will impose a 25% tariff and other penalties on goods shipped from India on August 1.
This is a major escalation as the two countries do trade worth billions a year. The U.S. exported goods worth over $41.8 billion in 2024, while its imports were worth $87.4 billion.
Other countries risk more tariffs this week. For example, Brazil, a country where the U.S. has a large trade surplus, will be hit with a 50% tariff. Others that will be affected include South Korea and South Africa.
The cryptocurrency market often experiences a decline when major geopolitical issues arise. For example, most tokens plunged in April when Trump announced his retaliatory tariffs.
Will the crypto market rebound?
Fortunately, there are signs that the crypto market will rebound in the near term. For one, demand for most crypto ETFs continues to rise, with the cumulative Bitcoin and Ethereum ETFs rising to $55 billion and $9.8 billion.
Another reason the crypto market is expected to recover is that, as the chart above shows, Bitcoin (BTC) has formed a bullish pennant pattern, indicating an eventual comeback. Such a move will lead to more gains among altcoins.
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