Bitcoin (BTC), Just When It Seemed to Rise... 'Fluctuates' on Employment Figures

▲ Bitcoin (BTC)/AI generated image

Bitcoin appears to have entered a volatile market, repeatedly surging and then retracting, as unexpectedly strong US employment figures fueled concerns about further interest rate hikes by the Federal Reserve.

According to the cryptocurrency media outlet CoinGaap on September 17 (local time), the US Department of Labor reported 196,000 initial jobless claims for the week ending September 12. This was a decrease of 10,000 from the previous week and fell below both market expectations of 207,000 and the previous week's figure of 206,000. The 4-week moving average also decreased to 203,250.

The decrease in initial jobless claims signifies that the US labor market remains robust and layoff pressure is not significant. This has increased the likelihood that the Federal Reserve (Fed) will maintain high interest rates for longer or implement additional rate hikes. The Fed had raised its benchmark interest rate by 25 basis points to 3.75%-4.00% the previous day. It presented a median federal funds rate of 4.1% for the end of the year, explaining strong economic growth, domestic consumption, and high inflation as the background for the rate hike.

Strong employment figures raised concerns that inflation would be difficult to quickly bring down to the Fed's target of 2%. Goldman Sachs also revised its forecast for an additional 25 basis point rate hike within the year. The renewed possibility of interest rate hikes became a burden for Bitcoin and the overall cryptocurrency market.

Immediately after the employment data release, Bitcoin rose 1.25% to $76,800 but later pared its gains. Analyst Ted Pillows stated on X (formerly Twitter) that “Bitcoin could reach higher highs with just one strong bullish candle.” The chart he presented showed Bitcoin's major high-point zone at approximately $82,000.

Analyst Michaël van de Poppe analyzed that Bitcoin rebounded from $75,584 and then approached the support and resistance zone around $77,500. The next resistance zone was suggested to be between $80,500 and $81,200. Poppe stated, “Bitcoin is currently facing resistance. To gain upward momentum, it needs to break through this resistance to head towards higher highs.”

[Key Article Summary]

-US initial jobless claims totaled 196,000, falling below both market expectations and the previous week's figure.

-Strong employment figures increased the likelihood of further Fed rate hikes, leading to increased volatility in Bitcoin.

-For Bitcoin, breaking through resistance levels at $77,500 and the $80,500 to $81,200 range has emerged as a key variable.

*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.*