Bitcoin price fell 1.3% in one hour as US payrolls beat expectations
Bitcoin (BTC) fell at the February 2nd Wall Street open as US unemployment data showed a surprise increase.
Markets have reduced the likelihood of a March Fed rate cut
Data from Cointelegraph Markets Pro and TradingView tracked the $500 hourly candlestick dip on Bitstamp.
Bitcoin immediately reacted to US non-farm payrolls that doubled estimates for January: 353,000 versus 185,000 expected.
The numbers suggest that sellers have managed to control that restrictive economic policy is not hurting the economy as much as thought. Interest rates can therefore remain high for a longer period of time, depriving risk assets – including crypto – of liquidity.
On January 31, the Federal Reserve unanimously opted to keep rates at their previous levels, as Fed Chairman Jerome Powell sought to dispel rumors of a March rate cut.
The jobless data amplified that narrative, reducing the chances of markets slowing before May.
According to data from CME Group's FedWatch Tool, the probability of a move in March stood at 17.5%, compared to 45% earlier in the week when it was written.
Caleb Franzen, founder of Cubic Analytics responded, “After all the doom and gloom after last month's NFP data on how to lower the December numbers, the reality is that the December numbers improved from +216k to +333k.” By X (formerly Twitter).
“Those who doubt the economy continue to go wrong.”
In his own response, financial analyst Tedtalksmacro was optimistic about the short-term effects of job losses.
“Wouldn't be surprised if crypto bounces back to highs in a few hours,” he wrote on XPost.
“Strong employment data is good data for the long term, because the market was too far off when prices fell – turn it on now…”
In a further headwind for crypto, the US Dollar Index (DXY) recorded rapid gains, reaching a new 2024 high.
GBTC exits will see a new offer.
Providing some relief to Bitcoin bulls are exits from Greyscale Bitcoin Trust (GBTC), one of the newly launched Bitcoin Exchange Traded Funds (ETFs).
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Flows into custodian Coinbase for the day totaled 4,400 BTC at the time of writing – a smaller move than in recent days and well below the peak of 25,000 seen in January, according to data from crypto data firm Arkham.
“Total net income yesterday was +$38M, so another day of income, albeit small,” commented Daan Crypto Trades, a well-known trader, in part on X's post on the data.
Today's #Bitcoin sent in $GBTC/Grayscale comes out to be worth ~4.4K$BTC or ~$190M.
little bit. I'm not sure if more is coming to another block but it could be.
Total net income yesterday was +$38m so another day of income albeit small. pic.twitter.com/dQcOsYxGbD
— Daan Crypto Trades (@DaanCrypto) February 2, 2024
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