Bitcoin (BTC) flashed volatility as Wall Street opened Jan. 6 after fresh US economic data disappointed risk-asset bulls.
BTC/USD 1 Hour Candlestick Chart (Bitstamp). Source: TradingView
Analyst: BTC price in line with a retest of $17,000
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD plummeting to $16,669 around the nonfarm payrolls and unemployment numbers on Bitstamp.
Both performed better than expected, with a mixed impact on the Federal Reserve’s room for maneuver when it comes to its further monetary tightening.
There could be some chance of relief for bitcoin, crypto and the broader risk assets phase in the coming weeks and months as the intensity of rate hikes eases.
“Expect a test of $17,000,” wrote on-chain analytics resource Material Indicators in part of a social media response.
An accompanying chart showed the BTC/USD order book on the largest global exchange Binance, with both bid and ask liquidity rising slightly.
BTC/USD order book data (Binance). Source: Material Indicators/ Twitter
Previously, Cointelegraph reported on the status of order book behavior showing that a sustained range between $16k and $17k is likely.
“Market poised for a hot read after yesterday’s release, shorts unwound after a quick impulse lower,” added popular non-farm payrolls commentator Tedtalksmacro.
However, he was less positive on unemployment, arguing that better-than-expected numbers could in turn encourage the Fed to continue a more hawkish approach.
“Not what cops want to see for now – ticking unemployment lowers crunch imo -> leads to higher rates for longer narratives,” he tweeted.
CPI bets point to a slowdown in Fed pace
Alongside the US, inflation data from the European Union also boosted morale and showed a bearish trend in the consumer price index (CPI).
Related: “Big Movement Brewing” for BTC Price? Bitcoin May Stay Flat, Analyst Hints
“Euro CPI is at 9.2% vs 9.6% forecast. This falls to 0.9% in a month, meaning inflation is cooling,” replied Michaël van de Poppe, founder and CEO of trading company Eight.
US CPI print for December 2022 is due next week, with expectations for the Fed’s subsequent rate hike currently trending towards 25 basis points, according to CME Group’s FedWatch tool.
Fed target rate probability chart. Source: CME Group
U.S. stocks edged higher on the day, with the S&P 500 and Nasdaq Composite Indexes up 1% and 0.6%, respectively.
The US Dollar Index (DXY) fell in lockstep, its inverse correlation with crypto and stocks once again visible as it fell a full point to the target of 104.5 at the time of writing.
US Dollar Index (DXY) 1 hour candlestick chart. Source: TradingView
The views, thoughts, and opinions expressed herein are solely those of the authors and do not necessarily reflect or represent the views and opinions of Cointelegraph.
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