Bitcoin Holds Strong Above Key Levels Despite Positive US Payrolls Data
Bitcoin (BTC) continues to show resilience above key levels despite a strong US payrolls report that has increased the odds of a Federal Reserve rate hike. According to Wintermute, a prominent market maker, August payrolls exceeded expectations, printing 162,000 against a consensus of 53,000. This has pushed the likelihood of a rate hike in September to nearly 60%.
Bitcoin briefly touched $82,400 before retracing, but it closed the week above $80,000, marking a 3.45% increase. Wintermute also highlights that Bitcoin exchange-traded funds (ETFs) experienced inflows of $987 million last week, marking the third consecutive positive week and bringing the total inflows to nearly $3.8 billion. In addition, Ethereum ETFs saw inflows of $215 million during the same period.
Investor capital appears to be shifting from equities and gold into BTC and ETH, according to Wintermute. The market maker notes, “Crypto held up well in response to the strong payrolls data, unlike equities and gold. The money that exited gold and stagnant equities found its way into Bitcoin and Ethereum. This shift indicates a potential new cycle as investors seek alternative assets.”
Despite a roughly 50% drawdown from its peak, Bitcoin’s current correction is less severe compared to previous cycles, with institutional participation through ETFs playing a role in supporting the price. Wintermute explains, “Breadth is improving, and profits from one cohort are fueling the next, which is characteristic of a young cycle. However, a break in this pattern could occur if a new leader fails to emerge or if major cryptocurrencies experience a significant downturn.”
Wintermute suggests monitoring Bitcoin’s price closely, particularly a clean break below $72,000 coupled with negative ETF outflows. Additionally, any increase in the Consumer Price Index (CPI) that pushes rate hike odds above 70% could also impact the cryptocurrency market.
Follow us on X, Facebook, and Telegram for the latest updates. Subscribe to receive email alerts directly to your inbox.
Generated Image: Midjourney