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End of ‘Uptober’ targets $40K BTC price — 5 things to know in Bitcoin this week

Bitcoin holds higher BTC price levels into what looks to be a crunch week for crypto markets across the board.
Bitcoin (BTC) starts…

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Bitcoin holds higher BTC price levels into what looks to be a crunch week for crypto markets across the board.

Bitcoin (BTC) starts a new week at comfortable highs as traders square off over BTC price action to come.

As macroeconomic uncertainty continues to grow, Bitcoin is cementing its new trading zone above $30,000.

The highest weekly close since early May 2022 is the latest achievement for bulls, and so far, bid support has allowed the market to avoid a deep retracement after last week’s snap 15% gains.

How could the environment change for BTC/USD this week?

As Bitcoin heads into the October monthly close, would-be volatility catalysts are brewing — not least thanks to the increasing geopolitical instability in the Middle East.

Adding to the hurdles for risk assets to overcome is the United States Federal Reserve, which will decide on interest rate adjustments on Nov. 1.

Under the hood, Bitcoin is looking better than ever, and the numbers prove it — network fundamentals are either at or circling all-time highs, continuing a trend in place for much of this year.

As price survives a mass profit-taking event at the hands of speculators, faith in further upside is proving hard to shake — but for some, the specter of a $20,000 crash is still firmly in play.

Cointelegraph takes a look at these factors and more in the weekly rundown of potential BTC price influencers for the coming days.

Countdown to the end of “Uptober”

After its highest weekly close in 18 months, Bitcoin continues to consolidate near $34,000 as the week begins.

A late-weekend surge took BTC price action to $34,700, helping add to the day’s BTC short liquidations, per data from monitoring resource CoinGlass.

BTC liquidations chart (screenshot). Source: CoinGlass

Despite this, the last weekly close of October was a calm event compared to a week prior, and with the monthly close now in focus, market participants will be keen to see if “Uptober” retains its bullish status.

Eyeing relative strength index (RSI) behavior, popular analyst Matthew Hyland was optimistic on the day.

“Current Bitcoin position would eliminate any possibility of bearish divergence forming on the weekly later on off the prior RSI high,” he wrote in an X post.

“This is extremely good for the bullish side and worst possible close for the bearish side.”

An accompanying chart showed RSI hitting higher highs on weekly timeframes. In a previous post, Hyland said that a weekly close at current levels would constitute a wider breakout.

RSI, which traditionally acts as an overbought signal at a given price when above 70, stood at 69.7 at the time of writing, with BTC/USD at $34,300, per data from Cointelegraph Markets Pro and TradingView.

BTC/USD 1-week chart with RSI. Source: TradingView

Similarly buoyant about what could happen to BTC price strength this week was popular trader Titan of Crypto.

In one of his latest X updates, he used the Ichimoku cloud to argue that a breakout toward $40,000 was on the cards.

As Cointelegraph reported last week, $40,000 is a popular target for bulls, but some remain notably surprised by the strength of the recent rally.

Trader Bluntz argued that it was “wild that we broke 32k with conviction held and have now found acceptance above 34k.”

“The doubt and disbelief is still lingering,” he continued in part of X commentary, suggesting that many retained a bear market mentality.

$20,000 BTC price dive “worst-case scenario”

Despite a week of holding higher levels, Bitcoin is far from convincing everyone that they will endure.

As Cointelegraph continues to report, $20,000 is a crash level that is still very much on the radar for some market participants.

The site of both a CME futures gap and the psychologically significant 2017 all-time high, $20,000 has not left traders’ consciousness seven months after BTC/USD last traded there.

Commenting on the prospect of such a move becoming reality, popular trader and analyst Rekt Capital described it as a “worst-case scenario.”

The timeframe for this to occur is the five-and-a-half months remaining until the next block subsidy halving event.

“That would be a -42% drop from here,” he wrote at the weekend.

“How likely is it that this could happen? Worst-case scenarios typically have a low probability of occurring.”

Rekt Capital had previously warned of a potential extensive BTC price downside at the hands of a double top pattern for 2023; this was subsequently invalidated with last week’s move.

Social media was naturally not short of those disregarding a $20,000 comeback altogether, among them CrediBULL Crypto, who described the eventuality as “near impossible.”

Bitcoin, he continued on the day, was in line to “melt through” the $40,000 mark.

Others highlighted the necessary levels to hold in order to avoid a rapid unwinding of recent progress.

“Looking for Bitcoin to hold this mid range retest and S/R flip,” analyst Mark Cullen wrote alongside a summary chart.

“If it breaks back below then i think the lower sweep could still be on the cards. Bulls don’t really want to see BTC trade for any time back below 32.5k, but a wick below to take liquidity isn’t off the table.”
BTC/USD annotated chart. Source: Mark Cullen/X

Trader Pentoshi, meanwhile, said that conditions had not changed on longer timeframes.

FOMC rate move due as crypto ditches stocks correlation

With trouble increasing in the Middle East and the impacts of war increasingly being felt outside the region, Bitcoin is seeing its second major conflict in the past two years.

Hodlers have a constant potential source of volatility in the background — something that will spar with U.S. macro data this week.

On Nov. 1, the Fed will meet to decide on whether benchmark interest rates should rise — an event that can form a short-term volatility catalyst in its own right.

Bitcoin has nonetheless dismissed Fed rate decisions in recent months, despite persistent inflation repeatedly beating market expectations.

Fed target rate probabilities chart. Source: CME Group

Per data from CME Group’s FedWatch Tool, markets currently expect the Federal Open Market Committee (FOMC) to leave rates unchanged this week.

“We have a huge week ahead,” financial commentary resource The Kobeissi Letter wrote in part of a summary.

Kobeissi touched on what could become a fresh BTC price headwind — a correction on the S&P 500. Previously correlated with stocks, Bitcoin’s more recent divergence may be put to the test.

Over the past month, the S&P 500 has lost 4%.

BTC/USD vs. S&P 500 1-day chart. Source: TradingView

In commentary last week, however, research firm Santiment not only confirmed the waning stock correlation but also said that this in itself was a sign that the crypto bull market was back.

Bitcoin mining difficulty, hash rate top previous peaks

For Bitcoin network fundamentals, there is no reason to pause for thought.

At its latest automated readjustment on Oct. 30, difficulty increased by 2.35% — hitting another all-time high.

Now at 62.46 trillion, difficulty reflects that competition among miners is more intense than ever — as Cointelegraph reported, it has never been so complex to mine a single BTC.

The hash rate tells an identical story, circling 493 exahashes per second (EH/s), according to the latest raw data estimates from statistics resource MiningPoolStats.

Commenting on the performance of both difficulty and hash rate, itself near record highs, James Van Straten, research and data analyst at crypto insights firm CryptoSlate, described the latter’s progress as a “surge.”

Jaran Mellerud, a mining analyst at crypto insights firm Arcane Research, predicted that the trend would continue.

“Bitcoin’s hashrate will likely continue surging due to the price pump coupled with the fact that miners are trying to outpace each other in upgrading fleets ahead of the halving,” he argued.

“I wouldn’t be surprised if we see 500 EH/s before the New Year.”
Bitcoin network fundamentals overview (screenshot). Source: BTC.com

Greed matches BTC price all-time highs

Waiting in the wings and vying with RSI for upside potential is the classic crypto sentiment gauge, the Crypto Fear & Greed Index.

Related: First Bitcoin ETF trades $1.5B as GBTC ‘discount’ echoes $69K BTC price

Having lingered in a narrow range for months on end, Fear & Greed staged a firm return in line with Bitcoin’s push higher — but unlike BTC price action, it has returned to November 2021 levels.

The latest data shows the index hitting 72/100 in recent days. This is firmly within the “greed” category and matches its position just days after Bitcoin hit its most recent all-time highs of $69,000 nearly two years ago.

Fear & Greed tends to reach extreme levels before a significant trend change occurs in price action.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

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February Employment Situation

By Paul Gomme and Peter Rupert The establishment data from the BLS showed a 275,000 increase in payroll employment for February, outpacing the 230,000…

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12 hours ago

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March 9, 2024

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By Paul Gomme and Peter Rupert

The establishment data from the BLS showed a 275,000 increase in payroll employment for February, outpacing the 230,000 average over the previous 12 months. The payroll data for January and December were revised down by a total of 167,000. The private sector added 223,000 new jobs, the largest gain since May of last year.

Temporary help services employment continues a steep decline after a sharp post-pandemic rise.

Average hours of work increased from 34.2 to 34.3. The increase, along with the 223,000 private employment increase led to a hefty increase in total hours of 5.6% at an annualized rate, also the largest increase since May of last year.

The establishment report, once again, beat “expectations;” the WSJ survey of economists was 198,000. Other than the downward revisions, mentioned above, another bit of negative news was a smallish increase in wage growth, from $34.52 to $34.57.

The household survey shows that the labor force increased 150,000, a drop in employment of 184,000 and an increase in the number of unemployed persons of 334,000. The labor force participation rate held steady at 62.5, the employment to population ratio decreased from 60.2 to 60.1 and the unemployment rate increased from 3.66 to 3.86. Remember that the unemployment rate is the number of unemployed relative to the labor force (the number employed plus the number unemployed). Consequently, the unemployment rate can go up if the number of unemployed rises holding fixed the labor force, or if the labor force shrinks holding the number unemployed unchanged. An increase in the unemployment rate is not necessarily a bad thing: it may reflect a strong labor market drawing “marginally attached” individuals from outside the labor force. Indeed, there was a 96,000 decline in those workers.

Earlier in the week, the BLS announced JOLTS (Job Openings and Labor Turnover Survey) data for January. There isn’t much to report here as the job openings changed little at 8.9 million, the number of hires and total separations were little changed at 5.7 million and 5.3 million, respectively.

As has been the case for the last couple of years, the number of job openings remains higher than the number of unemployed persons.

Also earlier in the week the BLS announced that productivity increased 3.2% in the 4th quarter with output rising 3.5% and hours of work rising 0.3%.

The bottom line is that the labor market continues its surprisingly (to some) strong performance, once again proving stronger than many had expected. This strength makes it difficult to justify any interest rate cuts soon, particularly given the recent inflation spike.

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Mortgage rates fall as labor market normalizes

Jobless claims show an expanding economy. We will only be in a recession once jobless claims exceed 323,000 on a four-week moving average.

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1 day ago

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March 8, 2024

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Everyone was waiting to see if this week’s jobs report would send mortgage rates higher, which is what happened last month. Instead, the 10-year yield had a muted response after the headline number beat estimates, but we have negative job revisions from previous months. The Federal Reserve’s fear of wage growth spiraling out of control hasn’t materialized for over two years now and the unemployment rate ticked up to 3.9%. For now, we can say the labor market isn’t tight anymore, but it’s also not breaking.

The key labor data line in this expansion is the weekly jobless claims report. Jobless claims show an expanding economy that has not lost jobs yet. We will only be in a recession once jobless claims exceed 323,000 on a four-week moving average.

From the Fed: In the week ended March 2, initial claims for unemployment insurance benefits were flat, at 217,000. The four-week moving average declined slightly by 750, to 212,250


Below is an explanation of how we got here with the labor market, which all started during COVID-19.

1. I wrote the COVID-19 recovery model on April 7, 2020, and retired it on Dec. 9, 2020. By that time, the upfront recovery phase was done, and I needed to model out when we would get the jobs lost back.

2. Early in the labor market recovery, when we saw weaker job reports, I doubled and tripled down on my assertion that job openings would get to 10 million in this recovery. Job openings rose as high as to 12 million and are currently over 9 million. Even with the massive miss on a job report in May 2021, I didn’t waver.

Currently, the jobs openings, quit percentage and hires data are below pre-COVID-19 levels, which means the labor market isn’t as tight as it once was, and this is why the employment cost index has been slowing data to move along the quits percentage.  

2-US_Job_Quits_Rate-1-2

3. I wrote that we should get back all the jobs lost to COVID-19 by September of 2022. At the time this would be a speedy labor market recovery, and it happened on schedule, too

Total employment data

4. This is the key one for right now: If COVID-19 hadn’t happened, we would have between 157 million and 159 million jobs today, which would have been in line with the job growth rate in February 2020. Today, we are at 157,808,000. This is important because job growth should be cooling down now. We are more in line with where the labor market should be when averaging 140K-165K monthly. So for now, the fact that we aren’t trending between 140K-165K means we still have a bit more recovery kick left before we get down to those levels. 




From BLS: Total nonfarm payroll employment rose by 275,000 in February, and the unemployment rate increased to 3.9 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in health care, in government, in food services and drinking places, in social assistance, and in transportation and warehousing.

Here are the jobs that were created and lost in the previous month:

IMG_5092

In this jobs report, the unemployment rate for education levels looks like this:

  • Less than a high school diploma: 6.1%
  • High school graduate and no college: 4.2%
  • Some college or associate degree: 3.1%
  • Bachelor’s degree or higher: 2.2%
IMG_5093_320f22

Today’s report has continued the trend of the labor data beating my expectations, only because I am looking for the jobs data to slow down to a level of 140K-165K, which hasn’t happened yet. I wouldn’t categorize the labor market as being tight anymore because of the quits ratio and the hires data in the job openings report. This also shows itself in the employment cost index as well. These are key data lines for the Fed and the reason we are going to see three rate cuts this year.

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Inside The Most Ridiculous Jobs Report In History: Record 1.2 Million Immigrant Jobs Added In One Month

Inside The Most Ridiculous Jobs Report In History: Record 1.2 Million Immigrant Jobs Added In One Month

Last month we though that the January…

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March 8, 2024

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Inside The Most Ridiculous Jobs Report In History: Record 1.2 Million Immigrant Jobs Added In One Month

Last month we though that the January jobs report was the "most ridiculous in recent history" but, boy, were we wrong because this morning the Biden department of goalseeked propaganda (aka BLS) published the February jobs report, and holy crap was that something else. Even Goebbels would blush. 

What happened? Let's take a closer look.

On the surface, it was (almost) another blockbuster jobs report, certainly one which nobody expected, or rather just one bank out of 76 expected. Starting at the top, the BLS reported that in February the US unexpectedly added 275K jobs, with just one research analyst (from Dai-Ichi Research) expecting a higher number.

Some context: after last month's record 4-sigma beat, today's print was "only" 3 sigma higher than estimates. Needless to say, two multiple sigma beats in a row used to only happen in the USSR... and now in the US, apparently.

Before we go any further, a quick note on what last month we said was "the most ridiculous jobs report in recent history": it appears the BLS read our comments and decided to stop beclowing itself. It did that by slashing last month's ridiculous print by over a third, and revising what was originally reported as a massive 353K beat to just 229K,  a 124K revision, which was the biggest one-month negative revision in two years!

Of course, that does not mean that this month's jobs print won't be revised lower: it will be, and not just that month but every other month until the November election because that's the only tool left in the Biden admin's box: pretend the economic and jobs are strong, then revise them sharply lower the next month, something we pointed out first last summer and which has not failed to disappoint once.

To be fair, not every aspect of the jobs report was stellar (after all, the BLS had to give it some vague credibility). Take the unemployment rate, after flatlining between 3.4% and 3.8% for two years - and thus denying expectations from Sahm's Rule that a recession may have already started - in February the unemployment rate unexpectedly jumped to 3.9%, the highest since February 2022 (with Black unemployment spiking by 0.3% to 5.6%, an indicator which the Biden admin will quickly slam as widespread economic racism or something).

And then there were average hourly earnings, which after surging 0.6% MoM in January (since revised to 0.5%) and spooking markets that wage growth is so hot, the Fed will have no choice but to delay cuts, in February the number tumbled to just 0.1%, the lowest in two years...

... for one simple reason: last month's average wage surge had nothing to do with actual wages, and everything to do with the BLS estimate of hours worked (which is the denominator in the average wage calculation) which last month tumbled to just 34.1 (we were led to believe) the lowest since the covid pandemic...

... but has since been revised higher while the February print rose even more, to 34.3, hence why the latest average wage data was once again a product not of wages going up, but of how long Americans worked in any weekly period, in this case higher from 34.1 to 34.3, an increase which has a major impact on the average calculation.

While the above data points were examples of some latent weakness in the latest report, perhaps meant to give it a sheen of veracity, it was everything else in the report that was a problem starting with the BLS's latest choice of seasonal adjustments (after last month's wholesale revision), which have gone from merely laughable to full clownshow, as the following comparison between the monthly change in BLS and ADP payrolls shows. The trend is clear: the Biden admin numbers are now clearly rising even as the impartial ADP (which directly logs employment numbers at the company level and is far more accurate), shows an accelerating slowdown.

But it's more than just the Biden admin hanging its "success" on seasonal adjustments: when one digs deeper inside the jobs report, all sorts of ugly things emerge... such as the growing unprecedented divergence between the Establishment (payrolls) survey and much more accurate Household (actual employment) survey. To wit, while in January the BLS claims 275K payrolls were added, the Household survey found that the number of actually employed workers dropped for the third straight month (and 4 in the past 5), this time by 184K (from 161.152K to 160.968K).

This means that while the Payrolls series hits new all time highs every month since December 2020 (when according to the BLS the US had its last month of payrolls losses), the level of Employment has not budged in the past year. Worse, as shown in the chart below, such a gaping divergence has opened between the two series in the past 4 years, that the number of Employed workers would need to soar by 9 million (!) to catch up to what Payrolls claims is the employment situation.

There's more: shifting from a quantitative to a qualitative assessment, reveals just how ugly the composition of "new jobs" has been. Consider this: the BLS reports that in February 2024, the US had 132.9 million full-time jobs and 27.9 million part-time jobs. Well, that's great... until you look back one year and find that in February 2023 the US had 133.2 million full-time jobs, or more than it does one year later! And yes, all the job growth since then has been in part-time jobs, which have increased by 921K since February 2023 (from 27.020 million to 27.941 million).

Here is a summary of the labor composition in the past year: all the new jobs have been part-time jobs!

But wait there's even more, because now that the primary season is over and we enter the heart of election season and political talking points will be thrown around left and right, especially in the context of the immigration crisis created intentionally by the Biden administration which is hoping to import millions of new Democratic voters (maybe the US can hold the presidential election in Honduras or Guatemala, after all it is their citizens that will be illegally casting the key votes in November), what we find is that in February, the number of native-born workers tumbled again, sliding by a massive 560K to just 129.807 million. Add to this the December data, and we get a near-record 2.4 million plunge in native-born workers in just the past 3 months (only the covid crash was worse)!

The offset? A record 1.2 million foreign-born (read immigrants, both legal and illegal but mostly illegal) workers added in February!

Said otherwise, not only has all job creation in the past 6 years has been exclusively for foreign-born workers...

Source: St Louis Fed FRED Native Born and Foreign Born

... but there has been zero job-creation for native born workers since June 2018!

This is a huge issue - especially at a time of an illegal alien flood at the southwest border...

... and is about to become a huge political scandal, because once the inevitable recession finally hits, there will be millions of furious unemployed Americans demanding a more accurate explanation for what happened - i.e., the illegal immigration floodgates that were opened by the Biden admin.

Which is also why Biden's handlers will do everything in their power to insure there is no official recession before November... and why after the election is over, all economic hell will finally break loose. Until then, however, expect the jobs numbers to get even more ridiculous.

Tyler Durden Fri, 03/08/2024 - 13:30

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