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Choppy Bitcoin Price Action Continues Ahead of Friday’s Jobs Report
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The price of bitcoin (BTC) remained below $66,000 late in the day during U.S. trading hours Wednesday after a couple of modest rallies were met with quick selling action.
At $65,800 at press time, bitcoin was flat over the past 24 hours. Dragged down by 10% declines in bitcoin cash (BCH) and litecoin (LTC) the broader CoinDesk 20 Index is lower by 0.7%.
Bitcoin managed two rallies to around the $66,500 level on Wednesday, one move coming a softer than expected report on March growth in the U.S. service industry and another coming after Federal Reserve Chairman Jerome Powell said he continued to expect rate cuts this year despite continued perkiness in both inflation and the economy.
Most of bitcoin’s rally in 2024 roughly came from mid-February to mid-March. It was during this time that the spot ETFs were regularly adding 5,000-13,000 bitcoin each day, even with sizable selling by Grayscale’s GBTC. The action since, however, has seen big sales of bitcoin continuing at GBTC, while purchases into the other ETFs have slowed. On many days, net flows into the spot ETF group as a whole have turned negative.
Alongside, the price of bitcoin has dipped about 10% from a record of nearly $73,500 hit on March 12.
In addition to the spot ETFs, another hoped-for catalyst this year was to be easier monetary policy from the Fed. Economic indicators, though, have crumpled much of that case.
Inflation, which had been receding steadily for all of 2023, has actually turned higher in the first months of 2024. At 3.2% year-over-year in February, it remains well above the Fed’s 2% target. Alongside, the economy appears to be continuing to steadily grow, with job additions of more than 200,000 each month so far this year and the unemployment rate remaining close to historic lows, according to government statistics.
Earlier Wednesday, ADP reported private payroll growth of 184,000 during March, topping February’s 155,000 and expectations for 148,000. The main event on jobs will be Friday morning’s Nonfarm Payrolls report from the government, with economists expecting 200,000 additions.
The strong data of late has sent the U.S. 10-year Treasury yield to its 2024 high 4.43% and the U.S. dollar to its strongest level since last November – both of which could tend to put a damper on risk asset prices, bitcoin included.
