Bitcoin fell below $64,000, rising U.S. Treasury yields pushed up interest rate hike expectations

Bitcoin fell more than 1.6% last Friday, and selling pressure intensified after the opening on Wall Street. This trend stems from traders becoming cautious about risky assets, which has been further stimulated by new pressure from U.S. Treasury yields and shifts in Fed policy expectations.

According to data quoted in market comments, the bitcoin exchange rate against the U.S. dollar once approached the $64000 region as bulls tried to hold on to earlier gains. The correction highlights the close linkage between cryptocurrency trading and macro signals, especially interest rates.

Key Points

Bitcoin weakened rapidly after the U.S. market opened, and its price trend approached the US$64000 mark. The rise in U.S. Treasury yields has strengthened the Fed's hawkish outlook, thus dampening risk sentiment. Market monitoring shows that buyer liquidity on a certain trading platform is relatively concentrated, which some traders believe may help stabilize the short-term correction. The pricing of the Fed Watch tool on the Chicago Mercantile Exchange still favors leaving interest rates unchanged at the next meeting, and a September rate hike remains a key point of contention. Many analysts view the current trend as a repeat of past market behavior, including obstacles near similar key moving averages in 2022.

High yields push up interest rate expectations

Geopolitical tensions and broader macro headwinds are seen as factors inhibiting risk appetite. An agency reported that rising Treasury yields were the main driver of the sell-off. The agency linked the trend to fluctuations in the yield curve and noted that markets were experiencing "sharp swings" even after the latest U.S. consumer inflation data were weaker than expected. The agency believes that the short end of the curve (especially the two-year yield) has an extraordinary influence on the Fed's expectations for the next policy rate.

Specifically, the agency said the two-year yield is currently at 4.31%, still "well above" the Fed's target range, putting downward pressure on risky assets as traders begin to adjust their expectations for further interest rate hikes. To measure market positions, the report cited the Chicago Mercantile Exchange's Fed Observation Tool. Data shows that the market expects the Federal Reserve to keep interest rates unchanged at the next interest-rate meeting, while continuing to absorb the possibility of a 0.25 percentage point rate hike in September-one of two expected interest rate hikes before the end of 2026.

The agency further pointed out that these interest rate hikes not only put pressure on cryptocurrencies, but also "pose downward pressure on the stock index." For traders, the practical significance is that Bitcoin's short-term trading range may remain highly sensitive to continued soaring yields and repricing of the probability of a Fed rate hike.

Traders focus on $64000: Structural testing intensifies

In terms of cryptocurrencies, short-term technical monitoring focuses on Bitcoin's performance in the near $64000 region. A recurring theme in trader comments is that liquidity below spot prices can sometimes cushion selling-at least temporarily. One cryptocurrency trader described what they called a "textbook trend" and said Bitcoin was repeating a pattern they had observed many times. In a post in early June, the trader mentioned the existence of a "protection team" on a trading platform, suggesting that multiple layers of buying liquidity may absorb downward pressure. The same view resurfaces in current monitoring: the trader pointed out that the order book showed multiple layers of liquidity below the current price. This means that the holders behind these buy orders may not be in a hurry to make deals-so the market may see some stability early in the decline, even if long-term trend signals remain uncertain.

Another analytical account highlights the importance of the US$64000 area as a structural key point. The account warned that a drop below $64000 would "negate" the short-term market structure. For active traders, this is not only volatility, but also a test of whether the market can hold short-term support.

Reappearance of the theory of resistance: 2022 trend and moving average test

In addition to a liquidity perspective, one analyst strengthened his interpretation of long-term trend patterns. The analyst believes that Bitcoin is repeating the trend seen during the 2022 bear market against the U.S. dollar, and specifically pointed out the behavior around the 50-month index moving average. The analyst said Bitcoin had "no evidence" to refute the argument and concluded that the asset still appeared to follow historical patterns. In the analysis cited, the reference area includes a 50-month moving average of approximately $65950, where Bitcoin has encountered multiple obstacles in recent times.

Although this does not automatically predict the short-term direction, it does affect how traders set expectations: if Bitcoin continues to encounter obstacles near the same macro key moving average, the rebound may be difficult to sustain, and any break in downward support may occur sooner than the bulls expect.

The macro versus crypto narrative game: What to focus on next

The current decline is influenced by both macro interest rate expectations and the microstructure of the cryptocurrency market. On the one hand, bond yields directly drive market sentiment, and some institutional assessments point out that two-year yields are a key variable that affects the Federal Reserve's action expectations. On the other hand, traders 'observations of the liquidity of a trading platform's order book suggest that there may be some demand areas that can cushion deeper declines.

Looking forward, traders should be watching whether Bitcoin can regain and hold its position near the mid-point of $65,000 (especially in the areas mentioned in the moving average analysis), or whether the market will fall below the structural threshold of $64000. At the same time, any new change in the probability of the Fed's observation instrument on the Chicago Mercantile Exchange, and further changes in the yield of two-year U.S. Treasury bonds, could quickly determine whether Friday's sell-off will evolve into a broader risk-averse or fade into consolidation.