A key gauge of U.S. economic health just posted its strongest monthly reading since August 2022, and some crypto analysts say it could presage a turnaround for Bitcoin, which is trading near $78,000.
The Institute for Supply Management (ISM) Manufacturing Purchasing Managers’ Index (PMI) rose to 52.6 in January, beating consensus of roughly 48.5 and ending 26 consecutive months of contraction, ISM reported. Readings above 50 signal expansion; below 50 indicate contraction. The last time the index was at or above this level was August 2022.
Several Bitcoin analysts pointed to the stronger PMI as a potential catalyst for renewed risk appetite. Data show the manufacturing index’s moves from mid-2020 through 2023 tracked Bitcoin’s price action closely. “Historically, these PMI reversals mark the shift to risk-on conditions,” said Joe Burnett, Strive’s vice president of Bitcoin strategy, noting that Bitcoin rallied after output-index upticks in 2013, 2016 and 2020. Pseudonymous analyst Plan C urged traders to adopt a business-cycle and macro view of Bitcoin rather than relying solely on the four-year halving framework.
Not everyone expects a perfect correlation. Benjamin Cowen, founder and CEO of Into The Cryptoverse, cautioned that “Bitcoin is not the economy,” pointing out stretches when the ISM Manufacturing PMI fell or stayed flat while Bitcoin climbed to its $126,080 peak.
Bitcoin has been volatile since the Oct. 10 liquidation event that wiped out over $19 billion in leveraged crypto positions. From that October high, Bitcoin is down roughly 38% at current prices, while metals and equity markets have largely moved higher, weighing on crypto sentiment.
Institutional forecasts for Bitcoin in 2026 vary widely. Venture firm Dragonfly expects Bitcoin to trade above $150,000 by year-end. Fundstrat’s Tom Lee predicted more retracement followed by a late-stage comeback and a new high. Galaxy Digital declined to make a specific call, calling 2026 “too chaotic” to pinpoint a price and suggesting a broad possible range between $50,000 and $250,000.
The ISM’s stronger-than-expected manufacturing reading adds a fresh macro data point to the debate over Bitcoin’s next leg. For some market participants it signals a shift back toward risk-on assets; for others it’s one of many indicators that may or may not align with crypto’s path.
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