Bitcoin (BTC) experienced a sharp pullback after a strong start to the week, with its price dropping to a two-week low of $62,700. The cryptocurrency was down by 5.5% in the past 24 hours, outperforming the broader CoinDesk 20 Index's 6.1% decline. Other major cryptocurrencies, including Ether (ETH), Solana (SOL), and XRP (XRP), also faced significant losses, with their prices falling by 5.8%, 10%, and 10% respectively.

Just three days ago, bitcoin had hit a four-month high above $70,000, but the recent market downturn has eroded those gains. The decline in prices coincided with the release of lackluster economic data. The US July ISM Manufacturing PMI fell well below economists' expectations, resulting in a decrease in interest rates across the board. Additionally, the US initial jobless claims reached their highest level in about a year. These indicators suggest that the US could be entering a monetary easing cycle by the Federal Reserve, which typically benefits risk assets, including bitcoin.

Federal Reserve Chairman Jerome Powell, speaking after the recent policy meeting, stated that a rate cut for September is highly likely if the economic data continues to show sluggish growth and inflation. This news, combined with the monetary easing campaigns of other central banks, such as the Bank of England, the Bank of Canada, and the European Central Bank, has created a sense of uncertainty in the markets.

Adding to the uncertainty is the shifting political landscape ahead of the upcoming US presidential election. Bitcoin bulls had initially been optimistic after former President Donald Trump expressed his support for cryptocurrencies, including considering the government holding bitcoin as a strategic asset. However, the odds of Trump's victory have declined to 55% from 70% just two weeks ago, while the chances of the new Democratic nominee-apparent, Kamala Harris, winning the election have steadily risen to 44%, according to Polymarket.

The implications of a potential Harris administration on the cryptocurrency industry remain uncertain. While it remains to be seen whether she would adopt the same stance towards bitcoin and crypto as the Biden administration, the likelihood of a more industry-friendly president in 2025 has diminished. This factor has prompted bitcoin bulls to reassess their outlook amidst the changing political dynamics.

As the market continues to navigate economic concerns and political uncertainty, the direction of bitcoin and other cryptocurrencies remains uncertain. Traders and investors are closely watching for any developments that could significantly impact the digital asset space.

In conclusion, bitcoin has experienced a pullback to a two-week low as economic data fell short of expectations and political uncertainty looms over the upcoming US presidential election. The cryptocurrency market remains highly volatile as it responds to various factors, and market participants are advised to closely monitor these developments moving forward.