Bitcoin (BTC) Loses $100K Level as Stronger-Than-Expected US Economic Data Throws Cold Water on Digital Assets' Momentum

Bitcoin (BTC) price dropped below the crucial $100,000 level on Tuesday morning U.S. time as two key economic data points from the U.S. came in stronger than expected, denting digital assets’ recent strong early-year momentum.

The Bureau of Labor Statistics’ JOLTS job openings for November unexpectedly rose to 8.1 million from 7.8 million the month before, easily beating analyst estimates for a decline to 7.7 million.

Also released at the top of the hour, the ISM Services Purchasing Managers Index, a monthly measure of the level of economic activity in the services sector, came in at 54.1 for December, above expectations for 53.3 and a solid improvement on November's 52.1. The Prices Paid subindex hit a fresh multi-month high of 64.4, well above the anticipated 57.5 and 58.2 in the previous month.

While neither report is typically a major market mover, combined they shook up an already jittery bond market, sending the 10-year U.S. Treasury yield higher by another five basis points to 4.68%, within a few ticks of multi-year highs. The move dragged U.S. stocks lower, with the Nasdaq now down over 1% in late morning trade and the S&P 500 lower by 0.4%.

BTC, which was trading just below $101,000 into European afternoon hours, dropped to $97,800 following the data, giving up yesterday's gains and falling 4% over the past 24 hours. Major altcoins declined even more with Ethereum's ether (ETH) and Solana's SOL dropping 6%-7%, while Avalanche's AVAX and Chainlink's LINK both tumbled 8%-9%.

The rapid price decline liquidated nearly $300 million in long positions across derivatives markets betting on rising prices, according to CoinGlass, marking the first large leverage flush of the year.

The strong data also had investors further rolling back their expectations of rate cuts in 2025.

While market participants had already priced out any chance of a rate cut at the Fed's January meeting, they now see just a 37% chance of an easing move at the central bank's March meeting, down from nearly 50% just a week ago, according to the CME FedWatch tool. Looking out even further, the odds of a rate cut in May are also now well below 50%. Scanning all of 2025, Ballinger Group's Kyle Chapman noted investors are now only pricing in roughly one 25 basis point rate cut for the entire year.