The Bitcoin (BTC) price has seen choppy trade since the release of a much stronger-than-expected US jobs report for September, swinging between the $61,000 and $62,000 levels as traders weigh up the economic outlook and geopolitical risks.
#US NFP September 254k vs 147k exp.
Pr 142k.
Unemployment rate 4.1% vs 4.2% exp/pr.
Participation rate 67.7% vs 62.7% exp/pr.
Wages 4.0% vs 3.8% exp/pr y/y.$USD— Forex Analytix (@forexanalytix) October 4, 2024
The US economy added 254,000 jobs in September, far greater than the median Wall Street expectation of 147,000.
The unemployment rate also fell to 4.1%, while the yearly pace of wage growth rose to 4.0% from 3.8% in August.
The strong report has seen macro traders pretty much erase all bets for another 50bps rate cut from the Fed in November.
Per the CME Fed Watch Tool, money markets were last pricing a near 95% of a 25bps rate cut next month.
CME FEDWATCH SHOWS 90.9% FOR 25BPS CUT AT FOMC NOV 7 MEETING, SHOWS 9.1% FOR 50BPS CUT
— *Walter Bloomberg (@DeItaone) October 4, 2024
The data supports the narrative that a soft landing for the US economy remains highly likely.
I.e. that the Fed will succeed in their mission to bring inflation back under control whilst avoiding a recession.
While it does mean a somewhat slower pace of rate cuts, the Fed is still expected to deliver substantial rate cuts this year and in 2025.
The combination of continued robust US economic growth coupled with an easing monetary policy environment should be a great combination for risk assets and the Bitcoin price.
The Bitcoin price remains lower by about 6.6% since the start of the week. Could a new rebound be around the corner?
Where Next for the Bitcoin Price?
Geopolitical risk remains a key factor to consider for the Bitcoin market, as well as broader financial markets.
Israel is expected to soon strike back against Iran, following the latter’s missile attack earlier this week.
Everyone on X : " Uptober is here, Q4 is very bullish"
Iran to Israel : pic.twitter.com/AIUwi7G5fW— naiive (@naiivememe) October 2, 2024
And that could spark a full-blown war between the two sides, which could have a severely disruptive impact on oil flows from the Middle East.
That is a major risk to the global economy and is keeping risk appetite, particularly in crypto, in check right now.
In the absence of recent geopolitical events/tensions, this week’s US economic data would have likely powered a strong rally in the Bitcoin price, perhaps to as high as $70,000.
And the positive US macro backdrop increases the likelihood of a strong rebound later this month – October, after all, is normally Bitcoin’s best month of the year.
But, thanks to the worsening geopolitical landscape, “uptober” may not come this year.
At least, that’s what Polymarket users seem to be betting – they place just a 25% probability that Bitcoin hits $70,000 this month, versus a 42% probability that it hits $55,000.
Standard Chartered, in a note earlier this week, warned that a short-term move under $60,000 was likely.
However, they said that investors should buy this dip.
JUST IN: $800 billion Standard Chartered bank says a #Bitcoin dip under $60,000 “should be bought into.”
Bullishpic.twitter.com/XLkV7g2ztK
— Bitcoin Magazine (@BitcoinMagazine) October 3, 2024
Indeed, geopolitical events tend to only have a short-term impact on markets such as Bitcoin and US equities.
Longer-term drivers such as a global monetary policy easing cycle could well drive Bitcoin back to record highs later in 2024 or in 2025.
This would coincide nicely with Bitcoin’s usual post-US election and delayed post-halving rally.
October may be choppy, but $100,000 remains on the cards in the coming quarters for the Bitcoin price.
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