Bitcoin Revaluation Triggered by Unexpected U.S. Employment Data Sparks
Summary:
This article discusses the instant revaluation of Bitcoin to $27,000 due to unexpected U.S employment data on October 6. The growth of U.S. non-farm payrolls shows the resilience of the labor market, despite the Federal Reserve's interest rate hikes to combat inflation. The data surprised many traders and financial commentators, who warned about potential risks for cryptocurrency and other assets. Traders' reactions were mixed, some pulling out due to announcements, others noting a decrease in Bitcoin's open interest. The article ends suggesting that readers should conduct their own research before making investment decisions.
Bitcoin experienced a quick reevaluation to $27,000 around the opening of Wall Street on October 6 thanks to the unexpected U.S employment data sparks in the market. This data, sourced from TradingView and Cointelegraph Markets Pro, showcased a 2.1% drop in the value of Bitcoin within one hour. However, it quickly regained its losses, shifting focus back to its prior target of $27,700 before the data was announced.
Fluctuations were attributed to U.S. non-farm payrolls (NFP) almost doubling the September expectations, growing from 170,000 to 336,000. This growth suggests resilience within the labor market despite the Federal Reserve's attempt to combat inflation through interest rate increases. Despite the strength displayed in these numbers, asset risks, including those of cryptocurrency, were viewed negatively.
CrypNuevo, a renowned trader, commented that the increased employment data was essentially adverse news because the Federal Reserve aims for a weaker labor market. He found it surprising that despite this growth, the unemployment rate remained at 3.8% and predicted that there may be downward revisions in these data. CrypNuevo also drew attention to the heightened possibility of the Federal Reserve introducing another rate increase at the Federal Open Market Committee (FOMC) November gathering.
The upcoming Consumer Price Index (CPI) report due next week could provide greater clarity, wherein CPI helps form critical inflation indicators for Fed policy. Financial commentary resource, The Kobeissi Letter, specified that this situation adds pressure onto both the markets and the Federal Reserve.
Specifically focusing on Bitcoin’s reactions, trader Skew reported that spot and derivative traders were pulling out due to the NFP announcement. Another perspective emphasized that likelihood of hike on Nov 1 is still insignificant unless the FED's approach and posture provide evidence to support it.
Earlier in the day, fellow trader Daan Crypto Trades noted a decrease in Bitcoin open interest (OI), which had initially displayed patterns of volatility. This reduction in OI moves Bitcoin towards a normal and healthier market situation.
This news does not entail any investment advice or suggestions. Investments and trading moves come with risks, and individuals should perform their research before making decisions.
Published At
10/6/2023 3:14:47 PM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.