Bitcoin's golden cross now has to survive a Fed rate hike

The price of long-term money has already undone the trade that lifted Bitcoin. The 30-year Treasury yield closed at 5.37% on Thursday, its highest level since before the 2008 financial crisis. Three weeks ago, a sudden drop in that same yield set off Bitcoin's 25% squeeze, and the squeeze is what finally pulled the 50-day moving average back above the 200-day for the first time since November.

So Bitcoin heads into the Federal Reserve's Sept. 15-16 meeting holding a bullish chart signal while the bond market takes back the support underneath it. Near $77,400 late Friday, it was 38.6% below its October record, up 22% over 30 days and down 3% over seven, according to CoinGecko.

The hike itself is close to a formality. The part the market has not settled is the calendar. In each of Bitcoin's three completed bear markets, the bottom arrived between 363 and 406 days after the cycle peak. Counted from last October's top, that window opens in the first week of October and shuts in mid-November, and the golden cross, the Fed and the ETF bid all have to be read against it.

1. 01The trigger-Bitcoin's 25% August squeeze began when the Treasury doubled long-bond buybacks and the 30-year yield fell to 5.19%. That yield closed at 5.37% on Thursday.
2. 02The Fed-August CPI rose 0.4%, with gasoline behind more than a third of the gain. Odds of a hike at the Sept. 15-16 meeting jumped to about 90%.
3. 03The signal-The Sept. 8 golden cross came 70 days after the June 30 low, matching the timing of the 2015, 2019 and 2023 crosses that were up 27% to 128% a year later.
4. 04The risk-The only golden cross that formed before a bear-market bottom, in July 2014, was 53% lower a year on. A close below $58,524 would put this cycle on that path.
5. 05The window-Earlier cycle lows came 363 to 406 days after the peak, which puts this cycle's window between Oct. 4 and Nov. 16.