Bitcoin Remains Below $112,000 Following Weak Jobs Report and Rate Cut Expectations
Recent economic data has impacted the cryptocurrency market negatively, particularly bitcoin (BTC), which remains below $112,000 despite expectations for easier monetary policy.
NFP Report Analysis
- August nonfarm payrolls showed only 22,000 job additions, significantly below the expected 75,000.
- Revisions for June and July decreased job creation by 21,000.
- Job losses were reported in nine sectors; health services and leisure/hospitality were exceptions.
- The probability of a Fed rate cut on September 17 reached 100%, with a 12% chance of a 50-basis-point cut.
- Upcoming revisions could indicate even weaker job growth, with estimates suggesting up to 1 million jobs may be revised away.
Bitcoin's Technical Outlook
- Bitcoin briefly rose above $113,300 but fell back below $111,982, indicating bearish sentiment.
- The failure to hold above this level reinforces a double top pattern, signaling potential further declines.
- Support is at approximately $101,700, aligned with the 200-day simple moving average (SMA).
- This double top pattern mirrors a previous one from February that led to a significant sell-off.
Treasury Yield Volatility
- Increased volatility in Treasury yields could affect BTC and other risk assets.
- Previous instances showed the 10-year yield rising after Fed cuts, despite initial declines.
- Current inflation levels are higher than last year, complicating future yield predictions.
- Analysts note concerns about ongoing fiscal spending and its potential impact on yields.
Upcoming CPI Data
- August Consumer Price Index (CPI) data is due next week, potentially showing inflation stickiness.
- Predictions suggest core CPI may rise by 0.3%, maintaining a year-over-year rate of 3.1%.
- Headline CPI is expected to increase 0.3% month-over-month and 2.9% year-over-year.