Major cryptocurrencies fell on Wednesday as the market geared up for the U.S. jobs report and policy speeches expected to hint at possible interest rate cuts. Bitcoin dropped 2%, now trading at $59,456, which has investors worried as it approaches important support levels.
As traders wait for more clarity, one big question is on everyone’s mind: Is Bitcoin heading for a bear trap, or is this just a brief pause before the next rise?
Bear Trap or Bounce Back?
Adding to the uncertainty is the upcoming jobs report from the Bureau of Labor Statistics (BLS), set to be released on Wednesday. This report could affect not only traditional assets but also cryptocurrencies like Bitcoin. Experts predict the report will show a loss of up to 600,000 jobs from April 2023 to March 2024.
This report could heighten fears of an economic slowdown, leading investors to sell off riskier assets like Bitcoin in favor of safer investments. However, some experts suggest the report might not fully reflect the real state of the job market. Goldman Sachs, for example, believes the data revisions may make the job market look weaker than it actually is.
Bitcoin’s Key Support Levels Under Watch
Analysts are closely watching Bitcoin’s position near its 200-day Simple Moving Average (SMA). Historically, when Bitcoin’s price falls below this trend line, it often signals a longer period of decline. This has led to speculation that the current consolidation might lead to a new bear market.
Adding to the worry, recent data shows that over 80% of Bitcoin holders who bought in the last five months are now at a loss. This situation is similar to past market conditions where such losses led to panic selling, potentially pushing prices down further.
Bitcoin’s Next Move: Bullish or Bearish?
With Bitcoin’s price at a crucial point and market-moving news on the way, the cryptocurrency is at a crossroads. If Bitcoin fails to break above the $60,000 mark, it could fall further to around $54,000.
On the other hand, positive news from the U.S. jobs report could give Bitcoin the boost it needs to move higher to around $62,000.
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The crypto community is divided. Where do you stand?
