U.S. manufacturing statistics turn positive as Bitcoin searches for bottom
Earlier today, as Bitcoin recovered from a volatile weekend, the US manufacturing sector delivered a surprising bullish surprise to the market, with the Institute for Supply Management's (ISM) Manufacturing Purchasing Managers' Index (PMI) rising to 52.6 in January, nearly four points above the consensus estimate of 48.5 and marking a return to expansion territory for the first time in over a year.
A PMI above 50 indicates net expansion in factory activity (a concrete measure of business confidence and forward-looking demand), the highest reading since mid-2022. This means companies are anticipating some post-holiday demand.
The breadth of the recovery was remarkable, with new orders surging to 57.1, production increasing and the backlog turning positive. It's this kind of internal structure that economists look to for signs that companies are ordering inputs and increasing output.
The number of employees remains below 50, suggesting that employment has not fully caught up, but overall the focus is on moving from contraction to expansion.
What does this mean for Bitcoin?
For the Bitcoin market, the impact goes beyond a single data point. Macro traders and crypto analysts often view PMIs as a leading indicator of broader economic momentum and risk appetite.
Expanding manufacturing activity signals improved earnings prospects for companies, stronger demand, and, importantly, increased investor confidence in risk assets. PMI data often influences corporate earnings and asset performance, and risk assets such as Bitcoin have historically trended upward in sustained expansion environments.
The crypto community typically jumps on PMI announcements as a sign that the economy is shifting from cautious to opportunistic.
A reading above 50 after a long period of economic weakness suggests stronger growth, prompting some investors to ease hedges and move to riskier assets such as Bitcoin. While no single number guarantees a turnaround, this surprise could add momentum to Bitcoin if traders see the expansion continuing.
The data comes as Bitcoin attempts to stabilize after one of its toughest weeks in years, which saw its price plummet below $80,000 for the first time since April 2025.
BTC briefly fell to nearly $75,000 over the weekend amid a chain of liquidations, but rebounded to around $78,400 early Monday, up about 1% on the day but still down about 12% over the past week.
The decline wiped out more than $200 billion from Bitcoin's market capitalization, capping a broader drawdown to about $800 billion since the asset peaked above $126,000 in October.
Bitcoin's decline coincided with a global risk-off movement. U.S. stocks fell as tech company profits slumped, losses spread across Europe and Asia and even traditional safe-haven assets were sold off. Gold and silver posted historic declines, reflecting the strength of the US dollar and changing expectations for monetary policy following the nomination of Kevin Warsh as the next Federal Reserve chairman.
Analysts at Bitcoin Magazine said the daily chart shows the RSI is in oversold territory after several days of selling. The bulls may attempt a gradual pullback, but Bitcoin could fall towards $72,000 before finding support. If a pullback materializes, the price could test resistance near $79,000 and potentially $81,000, beyond which upside potential is limited.
The post US manufacturing data turns positive as Bitcoin seeks bottom appeared first on Bitcoin Magazine and written by Micah Zimmerman.
