The Institute for Supply Management's (ISM) Manufacturing Purchasing Managers' Index (PMI) is under scrutiny for its potential influence on extending Bitcoin's market cycle beyond historical norms. The ISM Manufacturing PMI, a key economic indicator of U.S. manufacturing health, has historically aligned with major peaks in Bitcoin's market cycles. This correlation, if it continues, suggests the current Bitcoin cycle may last longer than usual.
The ISM Manufacturing PMI is based on a monthly survey of supply chain managers across 19 industries in the U.S. manufacturing sector. The survey encompasses areas like new orders, production, employment, supplier deliveries, and inventories. A PMI reading above 50 indicates expansion in the manufacturing economy, while a reading below 50 suggests contraction. The PMI is a composite index based on seasonally adjusted diffusion indices for new orders, production, employment, supplier deliveries, and inventories.
Currently, the ISM Manufacturing PMI has remained below the neutral 50 mark for seven consecutive months, signaling contraction in the manufacturing sector. In September 2025, the ISM Manufacturing PMI rose to 49.1, up from 48.7 in August, but still below market expectations of 49.0. This indicates ongoing weakness in the manufacturing economy. Despite the contraction, manufacturing's shrinking share of the U.S. economic output means a contraction in the PMI does not necessarily signal a recession.
Historically, Bitcoin's price cycles have shown increasing alignment with the ISM Manufacturing PMI, serving as a leading indicator for market inflection points. Rising PMI above 50 correlates with Bitcoin bull phases, while contractions below 50 trigger bearish trends. For example, in early 2025, the ISM PMI crossed above 50 after a 26-month contraction, coinciding with a renewed bullish trend in Bitcoin. Conversely, a July 2024 reading of 48.5 triggered a sharp selloff in Bitcoin prices.
Some analysts believe that the current extended period of manufacturing contraction, as reflected in the ISM PMI, could delay the peak of the current Bitcoin cycle. Real Vision's Raoul Pal suggests that liquidity trends could push the market's peak into 2026. Pal observes that Bitcoin's price has historically moved in sync with the ISM, especially during periods of economic growth. However, with the ISM still below 50, Bitcoin's potential for gains remains limited. He attributes this to a lengthened business cycle, where debt maturities have shifted from four to five years, postponing the liquidity and risk-taking peak.
Advanced statistical tools also reinforce the ISM PMI's relevance. Bitcoin Magazine Pro's Pi Cycle Top Indicator, when combined with ISM PMI data, projected a potential peak around October 19, 2025, with a median price of $200,000.
However, other factors could influence Bitcoin's price trajectory. Global liquidity conditions, particularly the M2 money supply, also play a role. Bitcoin prices often follow changes in M2 with a 10-week lag, and this relationship intensifies when the ISM PMI signals economic expansion.
While the ISM Manufacturing PMI provides valuable insights into potential Bitcoin market cycles, it's important to consider other factors and exercise caution. The correlation between the ISM PMI and Bitcoin's price may evolve over time as Bitcoin adoption increases.
