Bumpy Ride Likely for Bitcoin After Strong US Jobs Report, But On-chain Metrics Still Screaming Bull Market
Friday was a choppy, indecisive day in the Bitcoin market, with prices swinging between losses and gains of about 1.0% each way as traders digested the latest much stronger-than-expected US labor market report for last month. According to the latest figures from the US Bureau of Labor Statistics, the US economy added a whopping 517,000 jobs last month, way above the expected job gain of 190,000, while December’s figure also saw a 30,000 upwards revision to 260,000.
Meanwhile, the household survey showed the unemployment rate dropping to a new more than five-decade low at 3.4%, despite a rise in the participation rate. Average hourly earnings continued to grow at a solid YoY pace of 4.4%, a little above expectations. The report beat economist expectations across the board.
A senior economist at BMO Capital Markets commented to the financial press that the report “raises serious doubts about the economy slipping into recession and the Fed ending its tightening cycle this spring”. Other analysts expressed skepticism about the headline NFP number, citing a risk of big revisions ahead.
Either way, even with possible future revisions, the “real” number is probably still going to be a very strong one. As a result, yields across the US treasury curve and the US dollar surged, while initially sent US stocks and Bitcoin initially fell.
However, buyers came in to support risk assets, perhaps on the hope that the latest data increases the chance that the US Federal Reserve is able to achieve its much hoped-for “soft landing” – where it tightens policy sufficiently to bring down inflation without provoking a recession that causes widespread job losses. Bitcoin was unable to sustain a rally, however, and is currently a tad lower on the
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