Bitcoin (BTC) experienced sudden downward movement on June 7 as the Wall Street market opened due to surprising United States payrolls data.
BTC/USD 1-hour chart showed a $1,300 drop in price in one hour, followed by a rebound. The U.S. nonfarm payrolls data exceeded expectations, indicating that the labor market was handling tight fiscal policy better than anticipated. This led to a decrease in the likelihood of the Federal Reserve reducing interest rates, a crucial factor for an increase in liquidity in risk assets and crypto.
Economist Mohamed El-Erian stated that this data rules out a rate cut in July. The Federal Open Market Committee (FOMC) was scheduled to meet on June 12 to discuss rates, with the market now predicting no cuts in the next three meetings. According to CME Group’s FedWatch Tool, the chances of a 0.25% decrease were at 0.6%, 8.8%, and 50.8% for the June, July, and September FOMC meetings respectively.
The unexpected rise in unemployment to 4% despite strong payrolls data prompted commentator Holger Zschaepitz to describe the US labor market as “schizophrenic.”
In terms of BTC price action, market participants remained cautious as volatility settled. BTC/USD stayed below key resistance levels, with spot bidders needed to support an upward trend. The focus shifted to $72,600 as the new resistance level, up from $71,900 earlier in the day.
BTC/USD chart exhibited a consolidation pattern between major support and resistance levels at $67,000 and $72,000. The sideways trading environment was evident with recent higher highs, lower highs, lower lows, and higher lows.
This article does not provide investment advice. All investment decisions involve risks, and readers should conduct their own research before making any decisions.