July's nonfarm payroll data "exploded" — job growth turned negative. According to textbook logic, a weakening economy should push Bitcoin down. Instead, Bitcoin climbed from around $58,000 to above $65,000.
A leading global cryptocurrency platform,suitable for both beginners and experienced traders.
New user benefit: 20% off trading fees upon registration!！
The market has not gone crazy. The pricing logic has changed: the market is trading "liquidity expectations," not "economic fundamentals."
What Happened
On August 7, the US Labor Department released July nonfarm payroll data: new jobs came in at -23,000, while the market expected +80,000. At the same time, the May and June figures were revised down by a combined 103,000.
As soon as the data came out, the market immediately repriced the Federal Reserve's rate path: the probability of a September rate hike plunged from about 75% to around 30%. The market had been worried that the Fed would keep hiking rates because of strong employment. This report directly knocked out the "rate hike expectation." The dollar index fell to a three-month low, and Bitcoin took the opportunity to rally about 2%, breaking above $65,000.
What Is the Market Pricing?
It is pricing the disappearance of rate hike expectations
The relationship between Bitcoin and jobs data is not simply "good economy = up" or "bad economy = down." It is "jobs data → Fed policy expectations → liquidity expectations → Bitcoin."
After the 2026 June FOMC meeting, 9 of the 18 members supported a rate hike before the end of the year, and the market once believed the probability of a September hike was as high as 75%. A rate hike means tighter liquidity, which is a headwind for Bitcoin. When the July nonfarm payroll data collapsed, the market judged that the Fed would not dare to hike in September. The rate path shifted from "tightening" to "pause," liquidity expectations improved, and Bitcoin was naturally repriced.
Bitcoin did not follow gold higher, which shows the market is not trading "safe haven"
Facing the same data, gold rose 9.3% over the past month, while Bitcoin fell 0.5% over the same period. After the data release, Bitcoin only rose 0.7%. Money chose gold rather than Bitcoin as a safe-haven asset. This suggests the rally was driven more by risk sentiment recovering after rate hike expectations were removed, rather than by "the economy is weak, so buy Bitcoin as a safe haven."
What Was Done Right
Case A: Positioning for the "expectation gap" in advance
If you bet before the data release that "nonfarm payrolls would come in weaker than expected → rate hike expectations would cool → Bitcoin would rise," this profit has already been captured. The key signal was that in the weeks before the release, the market had already priced a high probability of a September hike at around 75%. Once the data surprised to the downside, the room for an expectation gap was huge.
Case B: Chasing after the data came out
If you only saw the data and bought afterward, risk had already accumulated. Bitcoin rose from $58,000 to $65,000, a gain of about 12%, and much of the profit had already been realized. Chasing the rally can easily lead to being knocked back after a spike.
High risk warning: one nonfarm payroll report does not confirm a trend reversal. Data released on August 16 showed that after July's negative payroll growth, Bitcoin only rose 0.7% on that day, with extremely low trading volume of less than 1% of market cap. This shows the market is waiting for more confirmation signals. More importantly, the July FOMC meeting kept rates unchanged by a 9:3 vote, and three members called for an immediate 25 basis point hike. If the meeting minutes released this Wednesday show that "the vote was actually very close," the market may reassess rate hike risk.
A leading global cryptocurrency platform,suitable for both beginners and experienced traders.
New user benefit: 20% off trading fees upon registration!！
Verification and Wrap-Up
Open the CME FedWatch tool and watch the real-time probability of a September rate hike:
If the probability stays below 30% → easing expectations still dominate, and Bitcoin has short-term support.
If the probability rises back above 50% → the market is repricing rate hikes, and Bitcoin may come under pressure again.
The next important release is this Wednesday's FOMC meeting minutes, which will reveal how close the July "9:3 vote to hold rates steady" actually was to a hike. That is the key signal for whether Bitcoin's rebound can continue.
