Bitcoin plunged again on Friday, dropping to $13, its lowest level since Jan. 19.600, but it also managed to climb above $20.000 with the help of an important US stat.
Indeed, some details in the NFP US jobs report have positively impacted the BTC/USD price and cryptocurrencies in general, upsetting expectations for the Fed's next rate decision.
NFP Report Shakes Fed Expectations, Bitcoin Gains Value
First, let's remember that Bitcoin was heavily influenced by Fed chairman Jerome Powell's testimony before the US Congress earlier this week. This actually opened the door to a 25 basis point rate hike at the FOMC meeting on March 22 , after a rate hike of only 50 points at the beginning of February .
Following this intervention, the market made a 50 basis point increase for the base case (most likely) for the next rate decision that caused Bitcoin to drop in the United States.
However, Friday's NFP report on US jobs, which was closely watched by the Fed, contained details that urged the market to revise its copy; The most likely scenario for investors is 60%.
Employment remains strong, but wages are slowing
Note that job creations are significantly higher than expected, 205k versus 311k expected. However, average hourly wages came in lower than expected, with 4,7% versus annual expectations of 4,6% and 0,3% versus 0,2% in previous monthly data.
Given that wage inflation is a major driver of rising prices, lower-than-expected wages are likely to put pressure on inflation, thus reducing the need for the Fed to raise interest rates too much.
Hence, it is this reasoning that prompted investors to invest in Bitcoin and the crypto market in general in the second half of the day on Friday, creating a rebound and not excluding a positive weekend.
Other crypto-specific factors continue to threaten BTC/USD
However, it should be borne in mind that even if the macro outlook is shining, other cryptocurrency-specific issues require attention and may negate the positive impact of improving macro sentiment.
The growing pressure from regulators, which manifests itself in various ways, alongside the woes of crypto bank Silvergate, which has been steadily weighing in on Bitcoin over the past few weeks, is making regular headlines that give digital assets a certain distrust.
There have been recent concerns about Circle's billions of dollars in reserves for USDC stablecoin deposited at Silicon Valley Bank, which has just been shut down by US regulators. As a matter of fact, this bank managed approximately 11,1% of the USDC's $25 billion reserve, which guarantees its value against the US dollar.
Bitcoin at a Technical Milestone
From a chart perspective, Bitcoin is now above the $20.000 threshold and the 100-day moving average ($20.296) tested Friday morning. These two thresholds now form an immediate zone of support.
Below this threshold, the Friday lows of $19.600, followed by the $19.000 and $18.400 region will be the next potential support.
In the event of a bounce, Bitcoin will have several chart resistances on its path before the $21.500 area. Then $22.000 and $22.600 will be the next bullish targets.