Bitcoin took a tumble on September 6th, falling below $54,000 after hitting a high of $57,000 earlier in the day. This sudden drop was triggered by a disappointing US jobs report, which showed the economy added only 142,000 jobs in August, much lower than expected.
Crypto Market in Turmoil
The weak jobs data sent shockwaves through the crypto market, causing Bitcoin to lose roughly 4% in the past 24 hours. Other major cryptocurrencies, like Ethereum, Ripple’s XRP, and Dogecoin, also experienced significant losses.
The sudden price swings led to heavy liquidations, with reports suggesting around $93 million were liquidated within a four-hour period. This was mainly due to leveraged traders who were caught off guard by the unexpected market downturn.
Rate Cut Speculation
The dismal jobs report sparked speculation about potential interest rate cuts by the Federal Reserve. Some investors believe there’s a 70% chance of a 25 basis-point rate cut at the next FOMC meeting on September 18th.
A smaller rate cut would be more favorable for risk assets like Bitcoin, as a larger cut could signal the Fed’s concern about a recession. However, the ultimate decision will depend on economic data and the Fed’s commentary.
Bitcoin’s Bearish Pressure Remains Low
Despite the overall market decline, data suggests that bearish pressure on Bitcoin remains low. This indicates that the current downturn might be due to limited selling pressure rather than a strong bearish sentiment.
While Bitcoin’s failure to hold above $54,000 after the jobs report highlights volatility in the market, the potential for a rate cut has added uncertainty. Market participants are closely watching the Fed’s next move.
Altcoins Suffer as Well
Like Bitcoin, altcoins have also taken a hit, falling below their key resistance levels. However, analysts believe the bearish pressure might not be as severe as it appears.
