The undercurrent wave is coming: 4 economic indicators from America that could reverse Bitcoin this week.

Bitcoin (BTC) is approaching the recent peak around the 122,000 USD level, indicating an effort to bounce back after the market's strong fluctuations. However, whether this upward momentum can continue or will soon be blocklisted remains a big question – as the market is focusing on a series of important economic data from the United States to be released this week.

In the context of Bitcoin increasingly being held by financial institutions and becoming more popular among individual investors, fluctuations from U.S. economic indicators – such as CPI, unemployment rate, or interest rates – are having a direct and profound impact on the price movements of the world's leading cryptocurrency.

U.S. economic indicators could derail Bitcoin's upward momentum this week

Bitcoin is trying to maintain its bounce back momentum, but the market has yet to escape the "waiting" state – as a series of key economic data from the United States is set to be released. According to MarketWatch, these indicators not only reflect the health of the U.S. economy but also have a direct impact on financial markets, including cryptocurrency.

Each signal, from inflation, retail sales to employment data, can individually affect investor sentiment and expectations regarding the Federal Reserve's interest rate policy (Fed) – a factor that has strongly influenced the price trend of Bitcoin recently.

Economic signals from the United States this week | Source: MarketWatch## CPI Index – A factor that could determine the next direction of Bitcoin

This week, all eyes in the financial market – including those of cryptocurrency investors – are focused on the United States Consumer Price Index (CPI) data, which is expected to be released on Tuesday, August 12. This is considered the most important indicator of the week, as it could shape expectations about the interest rate policy of the Federal Reserve (Fed) in the coming months.

According to the schedule, economists predict that the CPI in July will reach 2.8% compared to the same period last year (YoY) – a slight increase from the 2.7% of June. Goldman Sachs also made a similar forecast. This increase is believed to be related to the new tariff policy of former President Donald Trump, which takes effect from August 7, and is expected to raise consumer goods prices.

"Economists agree that tariffs have pushed the CPI in July higher," said Peter Tarr, a private investment manager.

If the CPI is announced higher than the expected 2.8%, the USD is likely to strengthen significantly – this usually puts downward pressure on Bitcoin and risk assets. Conversely, if the inflation data is lower – for example, below 2.7% – the market may welcome this as a strong support signal for cryptocurrencies.

"The newly released unemployment data has pushed the probability of the Fed cutting interest rates in September to 91%. If the upcoming CPI index is lower than expected, it is highly likely that the Fed will officially lower interest rates – thereby boosting the upward momentum of risk assets, including cryptocurrencies. Conversely, if the CPI is higher than forecasted, expectations for policy easing will diminish, putting pressure on the crypto market. However, with the unemployment rate rising, the CPI is likely to cool down – and that will be a positive signal for the market," said an analyst at BitBull Capital.

However, there is also a more cautious view. According to Peter Tarr, the market seems to have begun pricing in expectations of higher inflation, so a high CPI may not necessarily cause significant volatility, unless it significantly exceeds forecasts.

PPI – Inflationary pressures from the ground up and the silent threat to Bitcoin

In addition to the CPI, another important economic indicator for the United States this week is the Producer Price Index (PPI) – expected to be released on Thursday. Unlike the CPI which measures consumer prices, the PPI reflects the level of inflation from the producer's side, often seen as an early indicator for future consumer price trends.

According to economists, the PPI for July is expected to increase compared to the 2.3% in June, continuing to reflect inflationary pressures in the supply chain. This raises concerns that inflation is not "cooling down" as expected, forcing the Fed to maintain a tighter stance for a longer period – a scenario that is not very positive for Bitcoin and risk assets that are sensitive to liquidity.

"The demand for NFP bonds is trending down as the market enters a week where both core CPI and PPI are forecasted to be higher than previous data. This is particularly important, as the Fed and investors may begin to assess that the current inflation risk is much greater than the risk of economic recession," Capital Flows warns.

Similar to the CPI, any figure that exceeds expectations in the PPI report could shake the Fed's interest rate cut expectations in September, thereby putting pressure on the stock and cryptocurrency markets. Conversely, a lower-than-expected PPI level would reinforce expectations that the Fed is about to pivot to easing – something that the crypto market is hoping for to maintain its growth momentum.

Retail Sales – "Consumers' Wallet" and the Pulse of the U.S. Economy

In addition to inflation, another important economic indicator that could affect Bitcoin this week is retail sales – data measuring consumer spending, which accounts for nearly 70% of the GDP of the United States. The report will be released by the U.S. Census Bureau on Friday, August 15, and may become a guiding indicator for the overall economic health of the U.S., as well as the global market sentiment.

After a 0.6% increase in June, analysts surveyed by MarketWatch expect July retail sales to rise by 0.5% – a stable level amidst many economic uncertainties. This indicates that consumer spending remains strong, even though there are signs of a slight "cooling off."

If the announced result is higher than 0.5%, it may boost expectations that the U.S. economy is maintaining good growth momentum – leading to increases in bond yields and the USD, but it will also put short-term downward pressure on Bitcoin, as the Fed may maintain a tighter policy for longer.

Conversely, if retail sales are lower than expected, the market may interpret this as a sign of weakening consumption, and thus, the Fed may become more dovish in its monetary policy. This would be good news for risk assets, including the cryptocurrency market.

Unemployment benefit request – A "cooling down" signal from the labor market and its impact on Bitcoin

Alongside inflation and consumer spending indicators, the U.S. labor market is also becoming an increasingly influential factor on Bitcoin and risk assets. This week, the data on initial jobless claims (Initial Jobless Claims) is one of the indicators to watch closely.

According to the latest report, the number of initial jobless claims for the week ending August 2 was 226,000 applications. Notably, the number of continuing claims also rose sharply, reaching 1.97 million in the week ending July 26 – the highest level since November 2021. Forecasts suggest that new claims may rise slightly to 229,000 this week, reflecting a stable trend but with signs of a slight "cooling off" in the labor market.

Data shows that "the economy is still creating jobs, but the pace is slowing down" – a development that could pave the way for the Fed to become more dovish, supporting the price of Bitcoin and other risky assets.

The slight weakening of the labor market is often received by the market as a supportive factor for future monetary easing policies. In the context of increasing expectations for interest rate cuts in September, any signs indicating that labor pressures are easing could drive capital back into the crypto market.

Justin