During the week from September 30 to October 6, Bitcoin traded in a wide range from $59,828 to $65,618, trading at the weekend at $62,000, which means a decrease of 5.5% since the beginning of the week. Ethereum (ETH) lost 8.88% over the same period, falling to $2,421.
The week began with negative dynamics against the backdrop of the speech of Federal Reserve Chairman Jerome Powell at the annual meeting of the National Association for Business Economics in Nashville. Although Powell expressed confidence in the continued decline in inflation, he also noted the Fed’s readiness for further action if necessary. After his speech, the probability of a 50 basis point rate cut decreased from 53% to 38%.
The middle of the week was marked by a sharp drop in quotes due to the escalation of geopolitical tensions between Iran and Israel. The missile launch into Israel and subsequent threats of retaliation have caused significant volatility across all financial markets. This has led to a record outflow of $240 million from US spot Bitcoin ETFs, indicating a decline in interest from institutional investors. The situation began to stabilize by the end of the week. On Friday, October 4, BTC/USDt increased by 2.19% to $62,086. Bitcoin began its growth in the Asian session. Increased volatility was observed in the American session after the publication of data on the US labor market. The labor market surprised – the number of new jobs significantly exceeded analysts’ expectations, and the unemployment rate fell to 4.1%.
On Sunday, October 6, Bitcoin (BTC) is trading around the $62,000 mark, its price has fallen by about 5.5% over the week. Renowned crypto analyst and CFO of the ASTL investment project Konstantinas Sizovas analyzed the market situation and assessed the prospects for the Bitcoin exchange rate movement over the next seven days.
Market participants reacted to the labor market report, and their attention again switched to the situation between Iran and Israel. The week has passed, so they will not react to subsequent missile launches with a collapse, unless this leads to an environmental disaster, blocking the Strait of Hormuz and a global energy crisis. Market sentiment shows that investors are now inclined to see the positive in literally everything. Strong employment data is perceived as a sign of the absence of a recession, weak – as a signal for the Fed to lower rates. Even neutral news is interpreted as a sign of a “soft landing” of the economy. It is interesting to see how Bitcoin is increasingly behaving like a classic risk asset, following the stock market, and not gold, with which it is often compared. Bitcoin is not a defensive asset, so it will behave like stocks.
According to BitRiver estimates, from a technical point of view, the $62,400 level served as support until October 1. If the weekend passes calmly, there is a high probability of consolidation above it. In this case, buyers will regain confidence in the continuation of growth to $70 thousand. If the market begins to draw a three-wave structure from $66,498, then it is quite likely to see a fall to $58,400 by October 10. A fall below $57 thousand will cast doubt on the renewal of the historical maximum and the Christmas rally. With the arrival of institutional investors and the emergence of options and ETFs, bitcoin volatility has decreased. We will not see the rate “flying” before, but it will fall like a 200-kilogram load.
Next week, important events: October 9 – publication of the FOMC meeting minutes and October 10 – data on consumer inflation. That is, the period of volatility will continue. Crypto investors are eagerly awaiting the release of the US Labor Department’s unemployment report for September and are hoping for signals from the Fed regarding a possible rate cut at the regulator’s next meeting in November. Unemployment data may play a decisive role in shaping the direction of the Fed’s policy in the coming months, and this will also affect the situation in the cryptocurrency market. Economists predict a slight decline in the number of new jobs in the non-farm sector – from 142 thousand in August to 140 thousand in September, while the unemployment rate in the US is expected to remain at 4.2%. If the forecasts come true, investors will wait for a soft rate cut by the US Fed. In addition, the easing of monetary policy in the US provides strong support to the crypto market and fuels cautious optimism among investors regarding cryptocurrencies. Thus, it can be summarized that next week may see a short-term period of growth, which will return Bitcoin to $ 66 thousand, and ETH – to $ 2650.
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