The latest US manufacturing data has lifted hopes of a Bitcoin rebound after the ISM Manufacturing PMI hit a 40-month high, beating expectations and signalling renewed economic expansion.
The Institute for Supply Management said its Manufacturing PMI rose to 52.6 in January, ending more than two years of contraction and marking the strongest reading since August 2022.
“Historically, these PMI reversals mark the shift to risk-on conditions,”
Said Joe Burnett, vice president of Bitcoin strategy at Strive, noting that Bitcoin has rallied after similar PMI upturns in past cycles.
Bitcoin fell to a 10-month low near $75,400 on Monday before recovering to around $78,000, with analysts pointing to a historical correlation between PMI trends and crypto prices from 2020 to 2023.
Pseudonymous analyst Plan C said investors risk missing “the second massive leg of this Bitcoin bull market” if they fail to shift from a halving-only mindset to a broader macro and business cycle view.
However, Benjamin Cowen cautioned that Bitcoin does not always move in lockstep with economic indicators, saying the asset rose last year even as manufacturing data weakened.