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Saturday, October 16, 2021

Bitcoin Price Has Gone Over Resistance Level Of $50K

The S&P 500 went down to an intraday high on the 2nd of September, with Bitcoin climbing to its highest point in the last three months. This movement from the cryptocurrency has been seen as a key report on the 3rd of September which highlighted that the US economy had put in fewer jobs than what was announced.

It also ended up lowering the likelihood of the Federal Reserve unwinding the stimulus program for this year. According to data from the U.S. Bureau of Labor Statistics, the NFPs or nonfarm payrolls have grown by 235,000 against expectations of 733,000 positions. At the same time, the rate of unemployment has gone down to 5.2% from 5.4%. 

Delta Variant FUD Behind Bitcoin Pump?

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The increase in the price of Bitcoin by 3.41% to a price of $50,961 can be directly attributed to a slowdown in the jobs sector in the country which would inevitably prompt the Federal Reserve to limit its taper tantrum. The last month saw no job gains in the leisure or the hospitality sector, which was a direct contract with an increase of around 350,000 positions every month for six months. At the same time, the restaurant sector ended up losing 42,000 jobs, which has signaled fears about the Delta variant. 

Bitcoin, the world’s largest cryptocurrency, ended up struggling in the second quarter of this year amid an economic rebound on a global scale. It went down from a price of $65,000 to under $30,000 after it faced additional headwinds from the Chinese ban on mining and anti-BTC tweets of Elon Musk.

Meanwhile, the economic recovery did bring out several speculations that central banks would remove their massive support. Jerome Powell, the Chairman of the US Federal Reserve, has already spoken about the reserves tapering by the end of the year.

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The job data hint on the 3rd of September indicates that the central bank in the country will have to continue its asset purchase program worth $120 billion.  This outlook will definitely stress non-yielding hedging assets like gold and bitcoin.

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