Bitcoin's recent rally has slowed, following an 18% surge since the Federal Reserve’s September meeting. The price correction comes as market participants respond to macroeconomic shifts, including rising bond yields and inflation concerns.

Despite strong performance last week, Bitcoin remains below the $70,000 mark as it contends with these challenges, 10x Research reported.

A key factor has been the rise in US 10-year Treasury yields, which climbed from 3.6% at the Fed’s September meeting to 4.2%. 

This rise, alongside stronger-than-expected US payroll data, has shifted market focus toward inflation, particularly as former President Trump’s election odds increase, signaling potential changes in economic policy.

Bitcoin liquidity, however, continues to rise. Tether’s USDT market capitalization has surged by $28 billion this year, with stablecoin inflows reaching $38 billion. This significant inflow, especially from stablecoins like Tether and Circle’s USDC, is expected to provide upward pressure on Bitcoin prices, according to market data.

The market is currently absorbing the impact of higher bond yields, but analysts remain optimistic about Bitcoin’s potential breakout. Spot ETF inflows and rising open interest in perpetual futures suggest that a recovery could be on the horizon. 

While retail trading volumes, particularly in regions like South Korea, remain low, the liquidity boost from institutional players could play a pivotal role in the next upward move.

Analysts expect Bitcoin’s uptrend to resume once the market digests the current macroeconomic environment.