Bitcoin (CRYPTO: BTC) plunged to $77,000 Thursday after August PPI inflation came in hotter than expected, liquidating over $190 million in long positions in 60 minutes.
What the PPI Data Showed
The Kobeissi Letter flagged on X that August PPI inflation rose to 5.4% year-over-year, above the 5.3% estimate, while core PPI climbed to 4.6% year-over-year, the highest reading since June 2026.
July’s headline and core PPI figures were also revised higher, adding further pressure on rate hike expectations heading into the Sept. 16 Fed meeting.
Adding to the pressure, the 10-year Treasury yield crossed 4.90% for the first time since November 2023, up 95 basis points since the Iran War began.
Even after the US Treasury announced it was tripling long-term bond buybacks to $6 billion, yields kept climbing, with 5% looking likely by next week.
The bond market, in other words, is pushing back directly against Washington’s attempts to keep borrowing costs down.
Why It Matters for Bitcoin and Other Risk Assets
For crypto and stocks, this matters because higher yields make safe government bonds more attractive, pulling money away from riskier assets like Bitcoin.
When yields rise sharply like this, traders tend to sell first and ask questions later.
Bull Theory posted on X that Bitcoin crashed $1,200 and dropped below $77,000 immediately after the PPI print, with over $190 million in long positions liquidated in just 60 minutes as traders repositioned for a higher-for-longer rate environment.
The last time PPI data dropped, Bitcoin pumped 26% in eight days, with traders pointing to the report as a key catalyst for the late-August surge from $64,000.
This time the outcome was the opposite, with hotter-than-expected inflation removing the rate hold narrative that had been driving crypto higher since Fed Governor Christopher Waller’s comments last week.
BTC Price Prediction: Key Levels to Watch
BTC is breaking below the ascending channel that guided the move from $64,000 in late August and now testing the $76,000 to $76,500 support zone where the rally originally launched.
RSI at 53.56 shows a bearish divergence that formed at the early September highs, with price making a marginally lower high while RSI failed to confirm.
Meanwhile, Bitcoin spot ETFs also posted $166.89 million in outflows this week through Wednesday, snapping a streak that included $986.85 million, $924.48 million, and $1.92 billion in the three prior weeks according to SoSoValue.
Key levels for BTC:
- $76,000 to $76,500 — critical support, must hold to keep uptrend intact
- $72,683 — 50-day EMA, next stop if support breaks
Image: Shutterstock
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