Bitcoin is trading between $77,000 and $79,000 amid a convergence of unfavorable macro pressures. Japan’s 10-year government bond yields have hit 3% for the first time since 1996, while the yen has strengthened against the dollar, with USD/JPY dropping from above 160 to around 154. The total size of yen-funded carry trades could reach $500 billion, and during historical episodes of sharp yen appreciation, Bitcoin has experienced price drawdowns of up to 20%. The Bank of Japan’s next meeting on September 17-18 is the next major catalyst, and a 20% drawdown from current levels would put Bitcoin near $62,000.
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