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▲ Bitcoin (BTC) ©CoinReaders
As Bitcoin (BTC) attempts an unstable rebound after plummeting to $76,000 in the aftermath of the Binance hack, this week's US midterm elections, employment indicators, big tech earnings announcements, and statements from Federal Reserve (Fed) officials have emerged as key variables that will determine the volatility of the cryptocurrency market.
According to crypto media outlet Cryptopotato on November 2 (local time), Bitcoin fell to $76,000 after the largest hacking incident in the crypto industry last week and then tried to stabilize around the $77,000-$78,000 level over the weekend. However, it fell by more than 7% in October, ending a three-month consecutive rise, and investor sentiment continues to be dampened by the Binance hack. Furthermore, with major political and economic events concentrated in the US this week, the possibility of increased market volatility is being raised.
The first variable is the US midterm elections, to be held on the 3rd. According to Reuters, the Democratic Party is highly likely to win the House of Representatives, while the Senate election results are relatively uncertain. If the congressional power structure changes, market expectations for government spending, fiscal policy, regulatory direction, and future debt ceiling negotiations could shift, affecting risk assets in general, including cryptocurrencies. With political uncertainty rising, the financial market's reaction to the election results is drawing attention.
The second variable is US employment indicators. The September Job Openings and Labor Turnover Survey (JOLTS) will be released on the 3rd, the ADP Private Employment Report on the 4th, and the highly anticipated October Employment Report on the 6th. Economists expect non-farm payrolls to increase by approximately 62,000 in October, an improvement from September's 29,000, and the unemployment rate to remain around 4.2%. If employment indicators are stronger than expected, the likelihood of an additional Fed interest rate hike in December will increase, leading to rising Treasury yields and the dollar, which could put pressure on risk assets like Bitcoin. Conversely, if employment is weaker than expected, market tensions may ease. In addition, the Institute for Supply Management (ISM) manufacturing index will be released on the 2nd, and the Services Purchasing Managers' Index (PMI) on the 4th.
The third variable is the earnings announcements of major US tech companies. According to the Kobeissi Letter, approximately 20% of S&P 500 companies will release their earnings this week. Apple and Palantir will announce earnings on the 2nd, and AMD and Super Micro Computer on the 3rd. As tech stocks fell sharply in October, an analysis suggests that if the earnings of large artificial intelligence (AI)-related companies do not meet expectations, additional selling pressure could occur on the Nasdaq, negatively impacting the cryptocurrency market, including Bitcoin.
The fourth variable is the statements from Federal Reserve officials. Since the Fed froze its benchmark interest rate at the end of October, the market has been highly anticipating a potential additional interest rate hike in December, and the scheduled statements from five Fed officials this week are drawing attention as clues to the future direction of monetary policy. Cryptopotato predicts that cryptocurrency market volatility could increase again this week, with the US midterm elections, employment report, big tech earnings, and Fed statements following one another. Bitcoin began trading in November around $77,000-$78,000 after experiencing a more than 7% decline in October and the aftermath of the Binance hack.
*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.*
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