US Employment Shock, Yet Bitcoin Breaks $65,000... Bitcoin's Fateful Resistance!

▲ Bitcoin (BTC) ©CoinReaders

Neither the employment shock nor the $626 million capital inflow led to a strong surge in Bitcoin (BTC). Bitcoin broke past $65,000 immediately after the announcement of a decrease in US non-farm employment in July, but the rise was only around 2%, remaining 48% below its all-time high of $126,198.07.

According to the investment news outlet TradingNews on August 7 (local time), US non-farm employment in July decreased by 23,000, contrary to market expectations of an increase of 80,000-83,000. Employment for May and June was also revised down by a combined 103,000, and the labor market participation rate fell to a five-year low of 61.4%. Consequently, the likelihood of a benchmark interest rate hike in September decreased from 55% to 46%, and Bitcoin rose to $65,240.41 during the trading day. However, compared to the Nasdaq index's 0.86% rise and gold futures' 3.02% rise, the rebound strength was limited.

US Bitcoin spot ETFs saw a net inflow of $626 million during the first three trading days of August, but the price remained largely stagnant. Among these, IBIT accounted for $479 million, or 76.5% of the total, and its cumulative net inflow of approximately $61 billion surpassed the $51.3 billion for all 12 products combined. Conversely, Ethereum (ETH) spot ETFs saw inflows of $53.1 million and $60.8 million on August 4 and 5, respectively, indicating a trend of some institutional funds moving to Ethereum.

Supply pressure was identified as a key factor hindering Bitcoin's ascent. Long-term holdings that had not moved for approximately 155 days or more decreased from about 15 million BTC to 14.7 million BTC in a week, with 210,000 BTC moving. This was largely due to increased security concerns from a Coldcard firmware flaw, leading to assets in existing wallets being moved to new wallets or regulated custodians. The reported damage from this incident amounted to a maximum of 1,816 BTC, approximately $116 million, and it is difficult to immediately ascertain how much of the moved quantity during the wallet transfer process constituted actual selling.

Technically, Bitcoin has surpassed the 50-day exponential moving average (EMA) of $64,587, but a clear breakthrough of $66,600 is needed to expect a trend reversal to the upside. Surpassing $67,576 could trigger a short squeeze worth up to $1.422 billion, with subsequent targets at the 100-day EMA of $67,025 and the 200-day EMA of $72,569. Conversely, if $63,000, where the cost basis of approximately 515,000 BTC is concentrated, breaks down, $60,000 and the July low of $58,000 could be retested. While the Moving Average Convergence Divergence (MACD) is improving, it remains negative, and the Relative Strength Index (RSI) is only 51.10, indicating no clear direction.

The media outlet assigned the highest probability of 50% to Bitcoin moving within the $63,000-$67,000 range for the time being. The bullish scenario probability is 30%, with a target of up to $72,569, premised on slowing inflation and continued ETF inflows. The bearish scenario probability is 20%, predicting a potential drop to $57,000 if $63,000 is breached. While 41 out of 45 on-chain metrics are in the lower range and the Fear & Greed Index has dropped to 25, signaling a potential bottom, the fact that the price did not move despite a $626 million net inflow into ETFs indicates that supply pressure remains strong.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*