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Bitcoin has been unable to break above or below its current fury, and price action remains undecided. During yesterday’s trading session, the cryptocurrency saw upward volatility, but today gains were once again surrounded as macroeconomic forces took over BTC.
At the time of writing, Bitcoin (BTC) is trading at $19,200 with sideways moves in the last 24 hours and 4% gains in the last 7 days. While major cryptocurrencies have been able to keep some of their gains from the past week, most are following the general sentiment in the market.
US Economy Report Collapses Bitcoin Price
As Bitcoin hit its emerging resistance level of around $20,500, the US released its recent economic report on the job sector. First jobless claims for the last job in September came in at 193,000, the lowest level since April 2022, according to a report from CNBC.
This is a decrease of 16,000 compared to the week before, when the number of unemployed applications was 215,000. This data indicates that the US economy has continued to see a spike in job numbers, with fewer people reporting unemployment.
Continuing jobless claims also saw a 29,000 drop for a total of 1.3 million. This data is relevant because the US Federal Reserve (Fed) is set up to prevent inflation from rising, as measured by the US Consumer Price Index (CPI).
The latest stat is currently at a multi-decade high, forcing the financial institution to raise their interest rates. However, the Fed’s monetary policy does not seem to affect US economic growth. The report stated:
The strong labor numbers come amid the Fed’s efforts to cool the economy and curb inflation, which is near its highest level since the early 1980s. Central bank officials have specifically pointed to the tight labor market and upward pressure on salaries as a target of policy tightening.
Bitcoin far from seeing a price floor?
As a result of this data, the old financial markets and Bitcoin traded downward. Market participants should expect further rate hikes and more aggressive action from the Fed as it seeks to cool inflation.
When the data became public, Lorretta Mester, president of the Cleveland Federal Reserve, spoke of “what we need to do to get back to price stability.” Other members of the financial institution are likely to take a similar stance. This will translate into more pain for Bitcoin and risky assets.
Commenting on the data, an analyst for material indicators said the following, as we share the chart below showing the crypto market’s response to the jobless report:
FireCharts shows how BTC traders reacted to the economic news. Strong economic report means that the FED tightening hasn’t had much or no impact yet. Translation: More aggressive rate hikes through the fourth quarter and into 2023. Macro analysis: THE SOIL is not in.
As NewsBTC reported yesterday, Bitcoin needs to stay above $18,700 to $18,600 to maintain potential bullish momentum. If bulls can defend these levels, the cryptocurrency could see a relief that will push the price north of $20,000 pending more economic announcements from the Fed.