Major cryptocurrencies fell on Wednesday as the market prepared for the upcoming U.S. jobs report and anticipated speeches from policymakers likely to advocate for interest rate cuts. However, Bitcoin’s price dropped by 2%, trading at $59,456, which has investors worried as it hovers near important support levels.
As the market awaits more details, the big question is: Is Bitcoin setting up for a bear trap, or is this just a pause before the next rise?
Upcoming U.S. Jobs Report
Adding to the uncertainty is the upcoming U.S. jobs report, which is set to be released on Wednesday by the Bureau of Labor Statistics (BLS), which could play a big role not just for traditional assets but also for cryptocurrencies like Bitcoin. Market experts believe the report will show a drop in job growth from April 2023 to March 2024, possibly by as many as 600,000 jobs.
Meanwhile, this could raise fears of an economic slowdown, causing investors to sell off riskier assets like Bitcoin in favor of safer options.
However, some experts warn that the report might make the job market look weaker than it is. For example, Goldman Sachs believes the revisions might not fully capture the real job growth during that period. So, even if the report seems negative at first, the situation might not be as bad as it appears.
Warning Signs for Bitcoin
Analysts are closely watching Bitcoin’s position near its 200-day Simple Moving Average (SMA). Historically, when Bitcoin’s price falls below this trend line, it often signals a longer period of decline. This has led to speculation that the current consolidation might lead to a new bear market.
Adding to the worry, recent data shows that over 80% of Bitcoin holders who bought in the last five months are now at a loss. This situation is similar to past market conditions where such losses led to panic selling, potentially pushing prices down further.
Bitcoin’s Next Move: Bull or Bear?
With Bitcoin’s price at a crucial point and market-moving news on the way, the cryptocurrency is at a crossroads. If Bitcoin fails to break above the $60,000 mark, it could fall further to around $54,000.
On the other hand, positive news from the U.S. jobs report could give Bitcoin the boost it needs to move higher to around $62,000.
