Friday’s U.S. non-farm payrolls report could bring volatility to the cryptocurrency market. According to Reuters, economists expect job growth to slow sharply in April, with employment expected to rise by just 62,000 compared with 172,000 in March, while the unemployment rate is expected to hold steady at around 4.3%.
At first glance, the weak hiring data appears supportive of Bitcoin and other risk assets. Weakness in the labor market is likely to reinforce expectations that the Fed will keep interest rates steady this year and could delay any tightening cycle thereafter. As of now, the market is pricing in stable interest rates this year and an increase next year.
But the situation is more complicated.
In addition to the release of non-farm payrolls data, the market will also keep a close eye on wage growth. Average hourly earnings are expected to increase by 3.8% year-on-year, up from 3.5% previously. Sticky wage pressures, combined with already rising oil prices, could exacerbate global inflation concerns and complicate the Fed’s path forward.
In other words, the market reaction may depend less on overall job creation and more on whether wage growth slows. With traders already pricing in the possibility of a rate hike next year, risk assets may need weaker-than-expected earnings data to stage a meaningful rebound.
For now, analysts remain generally constructive on Bitcoin, with the $75,000 level seen as key support.
Alex Kuptsikevich, chief market analyst at FxPro, said: “Bitcoin is back below $80,000, and after briefly entering overbought territory near the upper limit of the ascending channel, Bitcoin continues to retreat from the 200-day moving average. The lower limit of the channel is near $77,500, but a broader trend breakout may require a break below the recent low around $75,000.”
In addition to the jobs data, traders are also focused on the upcoming minutes of the Federal Reserve’s April meeting, as well as developments in the Strait of Hormuz and global oil markets.
“Markets are pricing in a 97% chance of normalization in the Strait of Hormuz on May 15. The gap between this pricing and the stock market’s willingness to calm down each escalation is the decisive contradiction of the week,” Singapore-based QCP Capital said in a market report. “If crude oil prices fail to downgrade ahead of the May 20 Federal Open Market Committee (FOMC) meeting minutes, the stagflation narrative will become harder to dispel.”
Stay alert!
Read more: For analysis of today’s altcoin and derivatives activity, see Today’s Cryptocurrency Market. For a complete list of this week’s events, see CoinDesk’s “Crypto Week Ahead.”
what is trend
S&P 500 call option volume surged to a record $2.6 trillion. What this means for Bitcoin (CoinDesk): Record S&P 500 call volume signals a surge in speculative risk-taking on Wall Street, providing a bullish clue for the cryptocurrency as the two are positively correlated.
Trump says ceasefire remains in place after fighting breaks out between the United States and Iran (Reuters): The United States and Iran clashed in the Gulf and the United Arab Emirates came under renewed attack, but Trump said a ceasefire remained in place despite the attacks, dampening hopes for a quick end to the war.
U.S. stocks rise as tech outlook offsets war worries: Market over. (Bloomberg): Gains in technology stocks are boosting U.S. stock futures as investors await the monthly jobs report. Oil Volatility. Benchmarks in Europe and Asia fell. Brent crude prices rose above $100 a barrel. The dollar fell for a second straight week.
Federal court rules against Trump imposing new global tariffs after Supreme Court defeat (AP): A federal court rules against Trump imposing new global tariffs after a crushing Supreme Court defeat. The International Trade Court in New York ruled that the 10% global tariff was illegal after small businesses sued.
today’s signal
Coinglass’ chart tracks the Coinbase Bitcoin Premium Index, which measures the price difference between Bitcoin traded on Coinbase, a proxy for U.S. institutional and spot demand, and offshore exchanges like Binance. Green readings indicate that BTC is trading at a premium on Coinbase, indicating stronger demand from U.S. investors.
This week, the premium has turned into a discount as Bitcoin attempts to gain a foothold above $80,000. Interestingly, the rally has stalled.
Historically, bull markets have tended to coincide with consistently positive index values. Therefore, the next move higher guarantees a return of the premium.