- Bitcoin price surges back above $60,000 following a weaker-than-expected US labor market report.
- The report has increased hopes for more than one interest rate cut by the Federal Reserve before the end of 2024.
- Bitcoin’s next move will depend on whether it can break out of its recent bearish trend channel.
Bitcoin’s price has surged back above $60,000 following a weaker-than-expected US labor market report. The report has increased hopes for more than one interest rate cut by the Federal Reserve before the end of 2024. Bitcoin’s next move will depend on whether it can break out of its recent bearish trend channel.
Bitcoin Price Reacts to US NFP Data
The Bitcoin (BTC) price has powered back into the mid-$61,000s in wake of a softer-than-expected US labor market report which has boosted hopes that the Fed cuts interest rates more than once before the end of 2024. The US economy added 175,000 jobs in April, below the Wall Street consensus for a 240,000 job gain. Meanwhile, the unemployment rate jumped to 3.9%, above the expected 3.8%.
Market Reaction and Bitcoin’s Next Move
As per the CME, the odds that the Fed will have cut interest rates more than once before the end of 2024 rose to around 62% from around 50% one day ago. This has put US yields and the US dollar under pressure, and injected bullish momentum back into the crypto market. However, it remains to be seen whether the Bitcoin price can break out of its recent bearish trend channel. To confirm a breakout of this downtrend, a push above $64,000 would be needed.
Where Is the Bitcoin Price Headed Next?
Softer-than-expected US jobs data caused a major bullish reaction in traditional financial markets and Bitcoin. However, it’s a risky assumption to make based on purely one jobs report alone. The Fed emphasized earlier this week that it will wait for more progress on inflation before cutting interest rates. If markets are getting ahead of themselves, then the Bitcoin price is at risk of correcting. Bitcoin traders need to remember that spot Bitcoin ETFs have been experiencing outflows recently.
Dip-Buying Opportunity
A retest here would be a very attractive area for bulls to get back involved. A drop to the low $50,000s would mark a 30% pullback from March highs. During past bullish cycles, Bitcoin pullbacks normally haven’t exceeded 30% by much. And long-term fundamentals remain very bullish for BTC. The question isn’t if the Fed will start cutting interest rates, but how soon. When cuts do eventually arrive, that will be a major tailwind for the Bitcoin price.
Conclusion
Bitcoin’s price surge following the US NFP data shows the crypto’s sensitivity to macroeconomic factors. While the price has risen above $60,000, it remains to be seen whether it can break out of its recent bearish trend. In the meantime, a dip could present a buying opportunity for investors, given the long-term bullish fundamentals for Bitcoin.
