Bitcoin (BTC) starts the first full week of August circling $63,000 as traders weigh the impact of the ongoing Coldcard wallet hack.
Key points:
- US Treasury Secretary Scott Bessent leverages a Federal Reserve repo facility for a joint intervention as the Japanese briefly recovers from forty-year lows against the dollar
- Oil prices fall sharply as president Donald Trump gives hope of a deal with Iran.
- Bitcoin rounds out July 7.4% higher, but warnings of a red August stay in place.
Bessent eyes further yen interventions
Concerns over US Treasury markets were behind the US decision to intervene in the Japanese yen last week. Washington engaged in a rare operation to support the yen after USD/ JPY had reached almost 164 last week, per data from TradingView.
USD/JPY one-day chart. Source: Cointelegraph/TradingView
“It was the first coordinated US–Japan foreign-exchange intervention since 2011 and the first joint operation specifically supporting the yen since 1998,” crypto trading company QCP Capital noted in analysis released on Monday.
“The distinction matters. The New York Fed acted as the Treasury’s fiscal agent rather than as an independent monetary-policy decision by the Federal Reserve. The operation therefore highlights how institutions outside the FOMC can also influence currencies, liquidity and broader financial conditions.”
Speaking to mainstream media, industry insiders placed emphasis on the desire to avoid Japan selling large amounts of US Treasuries. The use of the Fed’s Foreign and International Monetary Authorities (FIMA) repo facility, which allows a handful of foreign central banks to access dollar liquidity without selling Treasuries, supports the theory.
“There is a self-preservation element here. Volatile markets driven by potentially fiscally-aggressive policies from Japan could extend to the U.S. Treasury markets, destabilizing the dollar,” Louise Loo, head of Asia economics at Oxford Economics, told CNBC.
In a post on X, Treasury Secretary Scott Bessent argued that FIMA could make further appearances going forward.
“Friday’s coordinated foreign exchange actions countered disorderly yen movements. Treasury remains attentive and in close communication with our counterparts at MOF and BOJ. We will not hesitate to participate in further joint intervention. The FIMA Repo Facility is an important backstop. We would encourage it to be upsized in the coming months,” he wrote.
Oil dives as Trump teases hope of Iran deal
US nonfarm payrolls data is the main point of interest for crypto and risk asset traders this week. Due on Thursday, the numbers will shed light on the strength of the labor market as recent US inflation prints have delivered mixed signals.
Last month, nonfarm payrolls came in far lower than expected. Only 57,000 jobs were added in June, short of the 114,000 anticipated, while the previous two months’ numbers were revised down by a combined 74,000 jobs. Bitcoin jumped on the news, because weaker labor-market conditions put pressure on the Federal Reserve to soften its stance on rate hikes.
Some market participants expect a rebound in July’s payrolls data. However, macro research firm Continuum Economics simultaneously projects an uptick in unemployment.
“We expect July’s non-farm payroll to rise by 120k overall and by 110k in the private sector, a significant improvement from June’s respective gains of 57k and 49k but largely explained by a recovery in leisure and hospitality. We expect unemployment to rise to 4.3% from 4.2%, reversing a June decline, and an in line with trend 0.3% rise in average hourly earnings,” it forecast last week.
US civilian unemployment rate. Source: Bureau of Labor Statistics
Macroeconomic data prints form just one locus of potential risk-asset volatility as markets look for cues for a lasting ceasefire between the US and Iran.
In a post on Truth Social on Sunday, US president Donald Trump revealed a delay to further strikes on Iranian territory, with a potential deal on the table.
“This would include the Immediate, Complete, and Total OPENING OF THE HORMUZ STRAIT, and an end to Iran’s nuclear threat. Based on this request, I have agreed, for the future benefit of the WORLD and, likewise, the survival of a successful and prosperous Iran, to cancel the attack, subject to being able to rapidly make a DEAL,” he wrote.
Oil prices fell immediately as the week began, with WTI and Brent crude both down more than 8% on Monday.
Stocks face tough seasonality into US Midterms
US stocks face seasonal friction between now and October, in the run-up to the US Midterm elections, analysis from trading resource Mosaic Asset Company warns.
The S&P 500 finished July down 0.8%, while the tech-heavy Nasdaq Composite Index saw its worst July losses since 2006 at -3.2%.
In the latest edition of its regular newsletter, The Market Mosaic, flagged seasonal changes as a major hurdle for equities beginning this month.
“Based on multiple lookback…
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