Bitcoin News Today: Bitcoin Aligns with Manufacturing's Contraction, Suggesting 2026 Peak

The U.S. manufacturing sector continued its contraction in November 2025, with the Institute for Supply Management's (ISM) Manufacturing PMI falling to 48.2, below the consensus estimate of 49.0 and a 0.5-point drop from October's 48.7. The reading marks the ninth consecutive month of contraction following a brief two-month expansion, underscoring persistent economic headwinds. The report highlighted mixed signals: while production expanded for the first time in a month, new orders and employment indexes contracted at accelerated rates. Prices for raw materials climbed for the 14th straight month, with the Prices Index hitting 58.5, driven by tariffs and rising steel and aluminum costs.

The contraction in manufacturing has sparked speculation about its potential impact on Bitcoin. Analysts have increasingly drawn parallels between Bitcoin's price cycles and the ISM PMI, a theory popularized by macro investors like Raoul Pal and Julien Bittel. Steven Walgenbach of CoinEdition noted that Bitcoin's gradual alignment with the ISM's trajectory suggests a potential peak in 2026, fueled by institutional adoption and regulatory clarity. This correlation, while speculative, has gained traction as Bitcoin's price movements appear to mirror broader macroeconomic trends.

However, Bitcoin's recent performance has been volatile. From early October to November, the cryptocurrency plummeted from $126,000 to below $82,200, with Deutsche Bank attributing the decline to five key factors: risk-off investor sentiment, a hawkish Federal Reserve, stalled progress on the CLARITY Act, waning institutional interest, and profit-taking by long-term holders. Unlike prior downturns driven by retail speculation, this correction has been exacerbated by institutional participation and macroeconomic uncertainty. The Fed's ambiguous policy stance, particularly after recent comments from Chair Jerome Powell and Governor Lisa Cook, has further dampened market sentiment.

The ISM report itself reveals deeper structural challenges in manufacturing. New Orders contracted for a third consecutive month, with only three of the six largest industries-Computer & Electronic Products, Food, Beverage & Tobacco Products, and Machinery-registering growth. Employment continued to decline, with 67% of surveyed companies managing headcounts through layoffs or unfilled positions. Tariffs, geopolitical tensions, and supply chain disruptions were cited by industry participants as persistent drags on demand. For example, Transportation Equipment manufacturers noted permanent staff reductions and offshore production shifts due to tariff pressures.

Despite these headwinds, some sectors showed resilience. Production expanded in November, with Food, Beverage & Tobacco Products and Computer & Electronic Products leading growth. Inventories contracted at a slower rate, and supplier deliveries improved, suggesting potential easing in supply chain bottlenecks. Yet, the overall picture remains one of cautious optimism. Susan Spence, Chair of the ISM Manufacturing Business Survey Committee, emphasized that while the contraction in manufacturing is concerning, the broader economy grew for the 67th consecutive month.

For Bitcoin, the path forward depends on both macroeconomic and regulatory developments. Analysts at Deutsche Bank caution that Bitcoin's recent behavior-closely tracking equity markets and diverging from its traditional role as a safe-haven asset-complicates predictions. The cryptocurrency's 46% correlation with the Nasdaq 100 and 42% with the S&P 500 in 2025 suggests it is increasingly influenced by risk-on/risk-off dynamics, mirroring equities rather than gold or treasuries according to recent analysis. If the Fed's rate trajectory stabilizes and the CLARITY Act progresses, Bitcoin could see renewed institutional inflows. However, without clarity on regulatory frameworks or a shift in monetary policy, further volatility remains likely.