Bitcoin
Why is the crypto market bearish today?
After the slight 0.48% pullback on Thursday, the bears took control Bitcoin last night. With a sudden drop in Bitcoin price of 2.05% on Friday, the major uptrending altcoins and the entire crypto market turned 180 degrees into a major pullback.
As Ethereum Price falling 3.56% and Solana 4.49%, the main altcoins return to the nearest support levels. The meme coin sector, which has performed well in recent weeks, has been hit with top performers such as PEPE falling 10.49%, Floki 11.87% and WIF 11.58%.
Overnight bearish turnaround in crypto market wipes out $360 million in long liquidations, per Currency Currency. Meanwhile, the US Bitcoin ETFs maintain a positive outlook with a total daily net inflow of US$130.99 million, with IBIT bringing in the bulk of US$168 million. This marks the 19th positive day, but also reflects a declining trend in inflows following the second-highest daily inflow of $886 million on Tuesday.
US jobs reports crash Bitcoin
On June 7, the price of Bitcoin fell from $70,771 to end the day at $69,326, an intraday drop of 2.05%. This sudden move in the cryptocurrency market leader is deeply influenced by the US May jobs report issued yesterday by the Department of Labor.
The US Department of Labor has a report highlighting the addition of 272,000 jobs last month. This is well beyond the predicted number of 185,000 and is unprecedentedly higher than the previous month’s figure of 165,000 jobs.
Furthermore, the superpower sees an increase in the unemployment rate, reaching a maximum of 4%, reaching January 2022 levels.
Real Crypto Jobs Influence Report
With the US unemployment rate rising, the crypto market reacts quickly as profit bookings begin. But why? Well, even though unemployment is rising, the Fed is not likely to cut interest rates in the near future. It could be because there are signs that the economy is still strong in other areas, such as job growth.
So, if the Fed decides to cut rates too soon, inflation could rise, which is already a concern.
Now, why did the market fall? In simple terms, employment data limits the chances of the US Feds cutting rates. The broader market anticipated a rate cut at the next Federal Open Market Committee (FOMC) meeting on June 12.
Why does the crypto market need a rate cut? Well, with a potential reduction in rates, the market will experience an increase in demand with lower financing costs and liquidity will increase. Hence, rate cuts are the next catalyst to fuel the bull market and drive up the prices of Bitcoin and altcoins.
Will Bitcoin continue the uptrend?
After the overnight drop below the $70,000 level, Bitcoin price is trading at $69,343 at a slow pace. Without much movement in the early Asian hours, a Doji candle is visible, trying to find support.
On the 1D chart, it is visible that the Doji is trying to gain support at the trend-based Fibonacci level of 23.60%. However, crypto price action shows the bearish engulfing candle formed last night, completing an evening star.
Furthermore, the constant rejections above the $70,000 mark reveal a huge supply at this psychological level. The uptrending 50D EMA could soon provide dynamic support with the daily RSI sustaining above the midline.
Consequently, the overnight pullback is likely a quick FUD reaction to the employment data. This project’s potential recovery in crypto price will reach $71,000 before the June 12 FOMC meeting.
Due to the recent hawkish data, the possibility of a sharp change in Bitcoin on the day of the FOMC meeting is high.
Read too: Top Four Altcoins With 100X Potential To Accumulate Now