(Kitco News) – Asset prices, from Bitcoin (BTC) to stocks and gold, struggled to hold their ground in early trading on Thursday as investors remained on edge due to rising Middle East tensions, while their attention is also focused on Friday’s highly anticipated September jobs report.
Of key interest is any new signs of weakening in the labor market, which could prompt the Federal Reserve to announce another 50 basis point (bps) rate cut despite widespread expectations that November will see only a 25 bps cut. According to the CME FedWatch Tool, the odds of a 25 bps cut at the next FOMC meeting are 68%.
Data provided by TradingView shows that after bouncing to $61,500 overnight, Bitcoin bears once again set their sights on taking out support at $60,000, with bulls giving their all to hold the line.
BTC/USD Chart by TradingView
“The crypto market lost another 1.44% of its capitalization in 24 hours to $2.13 trillion,” noted Alex Kuptsikevich, senior market analyst at FxPro. “The pressure is due to the ongoing wave of dollar gains and declines in risk assets due to the medium-term impact of the Middle East conflict and short-term profit-taking ahead of the US jobs report. The Sentiment Index returned to fear territory, falling to 37, a two-week low.”
“Bitcoin found support on the decline towards the 50-day moving average and the $60,000 area,” he added. “Over the next two days, swings within the $60-63.6K area could be misleading market noise as the market awaits new information.”
One token that has seen more volatility than most in recent days is XRP. At first, the community got excited and the token rallied higher after Bitwise announced the first spot XRP exchange-traded fund (ETF) filing with the Securities and Exchange Commission (SEC). But the mood soon turned sour after the SEC announced that it was appealing the recent decision on its lawsuit with Ripple, the issuer of XRP.
“XRP, which has lost around 20% in four days, is failing to find support,” Kuptsikevich said. “Despite the news of the ETF application, the coin fell from the upper boundary of the sideways range to the lower boundary. On Wednesday, it broke the 50—and 200-day moving averages in one fell swoop, pulling back below $0.53. A breakout of the range with a confirmation below $0.50 could trigger a drop to $0.40.”
XRP/USD Chart by TradingView
On the whole, the crypto market has had a rough start to October, with some in the community now circulating memes petitioning to rename ‘Uptober’ to ‘Rektober’ as hodlers see the value of their portfolios decline.
Petition to rename:
“Rektember” to “Uptember” and
“Uptober” to “Rektober”.— Daan Crypto Trades (@DaanCrypto) October 3, 2024
But hope remains on the horizon, as analysts far and wide still see a strong finish to the end of the year for Bitcoin and the altcoin market.
“Spot buying aggression of BTC has significantly stalled and this, combined with BTC ETF outflows, is one of the key reasons for the decline in Bitcoin price now,” said Jag Kooner, Head of Derivatives at Bitfinex, in a note shared with Kitco Crypto.
“While the first half of October could see declines of 8-10%, we still expect the month to end neutral to positive, depending on when the uncertainty regarding geopolitical conditions alleviates,” he added.
“Over the past 4 months, BTC price correlation with equities has only increased. We see this continuing and with BTC behaving like a tail risk asset,” Kooner said. “Meanwhile, correlation with safe-haven assets such as Gold will probably decrease, especially if economic and geopolitical conditions deteriorate globally.”
As for what to expect in the near term, market analyst Justin Bennett said he “expects demand at $BTC 59k, but long liquidations are sitting at $57k, so we probably see #Bitcoin take that liquidity before bouncing.”
At the time of writing, Bitcoin trades at $60,103 for a decline of 2.07% on the 24-hour chart.
