Bitcoin (BTC) briefly surged before Wall Street opened on September 6 after U.S. jobs data fell short of expectations.
Bitcoin falls below $55,000
According to data from Cointelegraph Markets Pro and TradingView, BTC price was targeting $57,000 before reversing completely after the start of the U.S. trading session.
It then hit a new one-month low of $54,919 on Bitstamp.
A weaker-than-expected August nonfarm payrolls report raised concerns about the strength of the labor market.
At the same time, a senior Federal Reserve official insisted that it was time to cut rates and that a decision to do so would be made on September 18.
“The current restrictive monetary policy stance has been effective in restoring balance to the economy and reducing inflation,” New York Federal Reserve Bank President John Williams said in a speech to the Council on Foreign Relations.
“With the economy now in equilibrium and inflation on a path toward 2 percent, it may be appropriate to reduce the target range for the federal funds rate and thereby make the policy stance less restrictive.”
After the data was printed, estimates from CME Group’s FedWatch tool suggested the odds of a 25bp and 50bp cut were roughly equal, at 53% and 47%, respectively.
The US dollar gained ground right after the opening bell, with Bitcoin jumping 0.3% as it offset the macro data.
But looking at the bigger picture, popular trader Daan Crypto Trades expects the dollar to remain weak in the long term.
He told X followers about the US Dollar Index (DXY): “$DXY is still very bearish and is stuck at the ~101 support level.”
“I think it’s just a matter of time before we get back above the 99.5 level, which would generally be supportive for risk assets.”
The BTC price chart shows the bulls’ dilemma.
While focusing on the short-term BTC price action, trader and analyst Rekt Capital captured a disappointing picture for bulls.
Related: Arthur Hayes Expects BTC Price to Drop Below $50,000 Despite Bitcoin Being at Risk of a ‘Huge’ Trend Change
“Bitcoin is forming a 4-hour downtrend channel, with a bullish divergence in progress,” X explained in part of the post.
The accompanying chart shows the Relative Strength Index (RSI) value increasing against a 4-hour price decline.
In further posts, it was confirmed that the price continues to reject the diagonal trendline within the channel structure.
“So the 4-hour candle body above the resistance line is very important to confirm the next trend,” he commented.
“Moving up/up diagonally is a prerequisite for rejection.”
This article does not contain any investment advice or recommendations. All investment and trading moves involve risk, and readers should conduct their own research when making decisions.