Matrixport Warns BTC Momentum Fades on Weak U.S. Data

But beneath the surface, Matrixport pointed to several concerning trends. These include weakening funding dynamics, a noticeable decline in stablecoin activity, and other forward-looking metrics that show a potential shift is already in progress. The firm’s models have reportedly begun flashing early caution signals, although the general market has yet to fully reflect these emerging risks.

Related: Howard Lutnick Hints Bitcoin Could Join U.S. Economic Data Tracking

Price Action Reflects Growing Uncertainty; Volume Spikes on Sell-Off

Bitcoin’s price has already responded to this shifting outlook with a notable drop. BTC fell by 1.08% over the past 24 hours, trading at $103,637.93 at the time of this report. The asset experienced a volatile intraday session on June 5, where it hit a high of $104,700 before plunging sharply below the $101,000 mark.

A minor recovery for Bitcoin followed in the early hours of June 6. This price action lines up with Matrixport’s earlier advice for traders to secure profits after a two-month bullish trend, as the firm was anticipating early signs of consolidation. That forecast now seems to be playing out. The broader altcoin market has also been hit, with Ethereum (ETH) and Solana (SOL) down 4% and 11%, respectively, in the same period.

Related: U.S. Court vs. Trump Tariffs: Bitcoin and Altcoins Take a Hit

Despite the price dip, trading activity actually intensified. Bitcoin’s volume surged by an impressive 45.32% to reach $62.44 billion. This raised the volume-to-market cap ratio to 3.02%, a clear signal of elevated market participation during the sell-off. Bitcoin’s total market capitalization, meanwhile, declined to $2.05 trillion, while its circulating supply remained at 19.87 million.

Weak U.S. Economic Data Adds to Market Pressure

Adding to the pressure on market sentiment, the latest U.S. ISM Non-Manufacturing PMI report showed unexpected weakness. This index reflects the performance of the services sector, which is responsible for about 80% of U.S. GDP. It fell to its lowest level since July 2024. Most economists had actually anticipated a rebound, so this decline signals a mild, and unexpected, contraction.

Matrixport suggested that some of the previous strength seen in economic demand might have been tied to accelerated purchasing by companies ahead of anticipated tariffs from the Trump administration. With that “front-loaded” activity now fading, the firm believes investor positioning could shift further in the coming weeks.

Matrixport’s Outlook: Watching Oil, Dollar; Fed Expected to Hold Firm

Looking ahead, Matrixport has identified two key macro indicators for investors to monitor closely: oil prices and the U.S. dollar. A continued drop in oil could signal deeper economic stress. 

On the other hand, weakness in the dollar might support the case for future interest rate cuts. However, with bond yields still trading in a range and inflation expectations remaining elevated, Matrixport notes that the Federal Reserve (Fed) is widely expected to stay on hold with its current interest rate policy for now.