Bitcoin Price Dips 4% as Market Anxiety Grows Ahead of US Jobs Report

Coinspeaker
Bitcoin Price Dips 4% as Market Anxiety Grows Ahead of US Jobs Report

Bitcoin has been on shaky ground this week, dipping to near a one-month low as global markets pull back from riskier assets. On Wednesday morning, the leading cryptocurrency fell over 4%, trading around $56,700.

The sell-off isn’t limited to Bitcoin. Other major cryptocurrencies also felt the pressure. Ethereum, the second-largest digital asset by market capitalization, has seen a 5% decline over the past 24 hours, hovering around $2,400. Similarly, Solana has also noted losses this week.

This downturn is part of a broader market retreat driven by concerns about the global economic outlook. Investors are closely watching the US payroll data due on Friday, indicating insights into the Federal Reserve’s next move. This would potentially have ripple effects across various markets, including cryptocurrencies.

In the options market, there’s been a noticeable uptick in demand for protection against further declines in Bitcoin price. In a recent interview with Bloomberg, Sean McNulty, director of trading at liquidity provider Arbelos Markets, stated that traders are particularly interested in hedging against potential drops following the payrolls report, as well as in the aftermath of the November presidential election.

“We’ve seen renewed downside buying interest in Bitcoin options, especially for post-payroll strikes at $55,000 and lower,” McNulty stated. He also pointed out that a significant position has been opened for options expiring on November 29 at a $35,000 strike price.

Further signs of market caution are evident in the decline in open interest for Bitcoin futures on the CME Group Inc platform, which has dropped to its lowest level since May. In addition, US Bitcoin exchange-traded funds (ETFs) have experienced their longest five-day streak of net outflows since June. On Tuesday, these investment funds recorded a net outflow of $287 million.

Katie Stockton, a technical analyst at Fairlead Strategies LLC, recently shifted her long-term outlook on Bitcoin to a “neutral bias.” She cited the increasing likelihood of a test of the $52,000 to $50,000 price range, a sentiment echoed by Tony Sycamore, a market analyst at IG Australia Pty, who also warned of potential downside risks.

Amid this uncertainty, some investors see an opportunity. Rekt Capital, a well-known Bitcoin analyst, recently discussed the current market phase, explaining that Bitcoin is in a reaccumulation phase following its most recent halving.

Notably, the crypto market is 140 days after the halving. According to Rekt Capital, this phase typically precedes a major breakout, with the potential for a significant price surge as early as late September.

“We’re really getting close to that breakout point in late September, as the post-halving reaccumulation phase tends to precede the parabolic phase,” the analyst stated.next

Bitcoin Price Dips 4% as Market Anxiety Grows Ahead of US Jobs Report