This week, Bitcoin failed to maintain the USD 58,000 level, slipping to lows around USD 55,250 and currently trading near USD 55,700. The 300-day EMA is positioned at USD 55,800, acting as the first support level (daily candle should not close below), from which BTC could quickly fall to USD 53,000 and potentially USD 50,000. On the upside, the initial resistance to reclaim is USD 58,000, followed by USD 60,000.
Overall, the crypto market has been in a downward trend in recent weeks, characterised by short-term squeezes that do not reflect genuine demand. It remains uncertain when buyers will re-enter the market. My view is that those on the sidelines are likely to step in around the USD 50,000- USD 53,000 range, while ETH/BTC has established a solid support level around 0.04.
On the crypto news side, Binance founder Changpeng Zhao (CZ), as part of his plea deal with US prosecutors, has been permanently banned from managing or operating Binance, according to Binance CEO Richard Teng. This lifetime ban contradicts earlier reports suggesting CZ would only face a three-years restriction.
The 30-day BTC ATM implied volatility currently stands at around 54%, while ETH is at 66%. The 25-delta skew remains negative for BTC across all timeframes up to 30 days, whereas for ETH, it stays negative until 60 days. However, ETH demonstrates a stronger positive skew in longer timeframes (beyond 60 days) compared to BTC.
On the macro side, BOJ Governor Kazuo Ueda reaffirmed the BOJ’s commitment to raising interest rates if the economy and inflation perform as expected.
On Tuesday, the ISM manufacturing PMI came in at 47.2, missing the forecast of 47.5. Nvidia experienced a 10% selloff on the first trading day of September, following news of US Department of Justice subpoenas related to an antitrust investigation.
On Wednesday, US JOLTS job openings also fell short, dropping to 7.673 million in July, below the expected 8.090 million. This increased the likelihood of a 50 basis point rate cut by the Federal Reserve. This news triggered a rapid drop in the US Dollar Index (DXY), which caused a brief surge in Bitcoin to USD 58,500, though the rally was short-lived.
Yesterday, Initial Jobless Claims slightly undershot expectations at 227K versus the forecasted 231K, while Non-Manufacturing and Services PMI exceeded forecast.
All attention is now on today’s Non-Farm Payroll report and US unemployment figures. Analysts are expecting 164,000 new jobs to be added, compared to 114,000 last month, while the unemployment rate is forecasted at 4.2%, down from 4.3% previously. Last month’s missed expectations triggered a risk-off sentiment, causing sharp declines in risk assets such as Bitcoin, which dropped from USD 64,000 on Friday to lows of USD 49,000 by Monday.
Looking ahead key events on the economic calendar include the German CPI on Tuesday, US CPI numbers on Wednesday, the ECB interest rate decision, and US PPI data on Thursday.
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