Gold Dips, Bitcoin Wobbles, and Fed Bets Shift
Gold Outlook: Pressured by Jobs Data, but Weekly Gains Hold
Gold prices fell for the second straight session on Friday after the US Nonfarm Payrolls report showed stronger-than-expected job growth. The metal lost 0.84% to close at $3,322 as markets dialed back expectations for imminent Federal Reserve rate cuts. Despite the decline, gold held onto weekly gains of over 1.30%, underpinned by lingering geopolitical risks in Eastern Europe and the Middle East. Rising Treasury yields and a firmer US Dollar also weighed on bullion, with the 10-year yield hitting 4.484% and real yields climbing to 2.196%. Next week’s inflation data will be key to determining gold’s near-term direction.
Dollar and Rates: Strong Jobs Report Shifts Fed Expectations
The US labor market surprised to the upside, with 139,000 jobs added in May and the unemployment rate steady at 4.2%. This resilience caused the US Dollar Index (DXY) to climb 0.49% on the day and pushed Treasury yields higher across the board. Traders are now reassessing the likelihood of rate cuts in 2025, with Fed funds futures pricing in just 44.5 basis points of easing by year-end.
US President Donald Trump added fuel to the conversation by taking to Truth Social, urging Fed Chair Jerome Powell to lower interest rates. “There is virtually no inflation (anymore), but if it should come back, raise ‘rate’ to counter. Very simple!!! He is costing our country a substantial amount of money. Borrowing costs should be much lower,” Trump posted. Earlier that day, the BLS confirmed Nonfarm Payrolls rose by 139,000 in May while also revising down March and April’s employment figures by 65,000 and 30,000, respectively.
Markets, however, are taking their cues more from economic data than political rhetoric. All eyes now turn to the June 17–18 FOMC meeting and incoming CPI and PPI reports. Read UltraTrader’s blog about economic indicators.
Crypto Market Update
Bitcoin Retreats: Heavy Liquidations, Political Tensions, and Technical Signals
Bitcoin briefly dipped below $101,100 on Friday, marking a sharp drop from its weekly high of over $105,000. This volatility followed escalating political tensions between President Trump and Elon Musk, which rattled broader markets and prompted investors to adopt a risk-off stance. The Fear & Greed Index sank to 45, reflecting growing caution.
Over $305 million in long BTC positions were liquidated within 24 hours, alongside $23 billion in profit-taking earlier in the week, per Sentiment. The long/short ratio of 0.91 suggests a bearish tilt, and derivatives data points to further downside risk.
Technically, Bitcoin is consolidating under resistance at $106,000, and a nearly 4% correction could push it to re-test the critical $100,000 support. The RSI stands neutral at 50, and MACD shows red histogram bars, indicating weakening momentum. A further decline could take BTC toward $97,732, while a recovery might see it test $106,794.
Despite bullish headlines like JPMorgan’s plans to accept Bitcoin ETF holdings as loan collateral and Strategy’s $979 million IPO for BTC acquisition, prices remain under pressure. Market sentiment remains fragile amid uncertainty surrounding US political developments.
Ethereum Struggles: Exchange Inflows Spike as Risk Appetite Fades
Ethereum fell over 7% on Thursday and hovered below $2,500 on Friday as traders responded to macro uncertainty and political drama. The ongoing clash between Trump and Musk spilled over into broader market confidence, leading to net inflows of 117,000 ETH to exchanges, the second-highest since April. These flows suggest rising sell pressure, with over $600 million in profits realized in the past two days. Options markets echoed bearish Sentiment, with 10D and 25D risk reversals dropping sharply. Though ETH ETFs saw modest inflows, they weren’t enough to reverse market momentum.
Trump vs. Musk Feud Spills into Crypto Markets
What started as policy disagreements over Trump’s “One Big Beautiful Bill” escalated dramatically when Musk accused Trump of being listed in sealed Epstein-related documents. The public spat intensified with mutual allegations, canceled contracts, and threats to decommission projects, such as SpaceX’s Dragon spacecraft. Tesla shares plummeted by over 15%, and Trump-related tokens, such as TRUMP, lost 10% in 24 hours. Fear of regulatory retaliation and funding cuts caused broader ripple effects across altcoins and tech-linked crypto assets. Retail traders turned cautious, and the crypto Fear & Greed Index flipped from neutral to fear in a day.
Conclusion: Markets Brace for Impact as Politics and Data Collide
This week reminded traders that financial markets are not driven solely by numbers. While the solid NFP data shifted Fed expectations and supported the dollar, the political drama between Trump and Musk injected fresh volatility into the crypto and tech sectors. As macroeconomic reports, such as the CPI and PPI, are released next week, investors will also need to closely monitor political developments. The intersection of data and narrative has rarely been more volatile, and traders would do well to stay both informed and nimble.
