-1736337431.png)
Bitcoin Under Pressure
Bitcoin bulls are dealing with fresh uncertainty in the market today following a sharp reversal lower yesterday. BTC futures plunged almost 7% on the day, suffering their largest single-day loss since August last year. The sell-off came in response to a stronger-than-forecast JOLTS job openings number yesterday. The upside surprise is fuelling expectations of similar strength in the upcoming NFP data on Friday. Robust jobs data is seen as further diluting the prospects of a follow up Fed rate cut in Q1 with market pricing for a hold jumping to around 63% post-data from around 50% prior.
Shifting Fed View
The volatility in BTC this week shows just how neurotic markets are given the expectations around Bitcoin this year as Trump takes office next week. Much of the rally across Q4 had been premised on expectations that Trump will lit a fire under the crypto market via easier regulatory conditions and a mainstream focus on wider uptake of crypto, especially Bitcoin. However, expectations of a continued Fed easing were still well seated at this time, adding to the bullish BTC view.
US Jobs Data
The shift in Fed expectations is a major headwind for BTC. It was a similar shift that capped the rally in March last year. Traders will now be looking ahead to Friday’s data with the risk that BTC sees further downside on any data strength. Ahead of that today, the ADP release poses near-term volatility risks, expected at 139k from 146k prior.
Technical Views
BTC
The sell off in BTC has seen the market breaking back below the 100,195 level. The risk now is that the market is forming a sloping head and shoulder pattern, suggesting risks of a deeper push lower if we break 91,750 with 86,645 and 74,655 the deeper levels to note.
.png)
Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 75% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Futures and Options: Trading futures and options on margin carries a high degree of risk and may result in losses exceeding your initial investment. These products are not suitable for all investors. Ensure you fully understand the risks and take appropriate care to manage your risk.
With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.