Why a new $ 50,000 test is likely ahead of Friday's US jobs data

The massive sales in the US dollar market at the end of last week attended Bitcoin ( BTC ) to climb above $ 49,000. However, BTC strugg...


The massive sales in the US dollar market at the end of last week attended Bitcoin (BTC) to climb above $ 49,000. However, BTC struggled to prolong its rise above $ 50,000, a level of psychological resistance, as investors remained cautious about the Federal Reserve Taper Calendar.

Bitcoin corrects after registering its high of $ 49,667 since the start of the week. Source: TradingView.com

In detail, Fed Chairman Jerome Powell delivered a slightly accommodating outlook during his Friday speech at the Jackson Hole Annual Symposium. At one point, he refrained from giving any hints as to when the Fed would start unwinding its $ 120 billion-per-month asset purchase program.

Powell noted that they would start to decline by the end of 2021, while admitting that the fast-spreading Delta variant of Covid-19 could play a spoiler role.

“We will carefully assess the incoming data and the evolution of risks,” he said.

“The timing and pace of the cut will not be intended to send a direct signal about when to take off interest rates.”

At the same time, the United States Bureau of Economic Analysis reported that the annual price of personal consumption expenditure (PCE), which the Fed considers its preferred measure of inflation, remained unchanged at 3.6%, about 1.6% more than the central bank’s target.

Points to focus on next week

The first half of the week saw no major macroeconomic events that could have a direct or indirect impact on Bitcoin and the rest of the crypto market.

But on September 1, the Automatic Data Processing (ADP) Research Institute data reveals August data on private sector employment. Additionally, investors will likely watch the ISM Manufacturing PMI for its Prices Paid component. In doing so, they could assess input price pressures in the manufacturing sector to determine inflation.

Friday, non-farm payroll (NFP) data hopes to show that the US economy has created 763,000 jobs in August, about 19% below the July impression of 943,000. As a result, disappointing employment data could delay the Fed’s decision to cut its asset purchase program and help increase the price of risky assets, including Bitcoin.

Technical configuration

Technically, Bitcoin has been trend within a short-term ascending channel, hinting at a move to the lower trendline (near $ 47,000) for a potential pullback to the upper trendline (above $ 50,000).

4-hour Bitcoin price chart with an ascending channel pattern. Source: TradingView.com

A prolonged sell below the lower Channel trendline could risk pushing BTC / USD exchange rates down towards the 200-4H exponential moving average (EMA 200-4H; the yellow wave) near $ 44,600 .

Related: Bitcoin Online For ‘Phenomenal’ Weekly Close If BTC Price Holds $ 49,000

The bearish target appears closer to that visible on the weekly chart.

Bitcoin weekly price chart setup. Source: TradingView.com

The BTC / USD exchange rate tested the 0.786 line (near $ 50,779) of the Fibonacci retracement chart after a 75.36% bullish move. As a result, a prolonged pullback from said price cap brings Bitcoin’s next downside target near the 0.618-Fib line (around $ 43,886).

Conversely, a neutral RSI reading (below 70) can help bulls recover $ 50,000 for a bullish breakout move. In doing so, they could aim for levels close to $ 60,000 as their next bullish target.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move comes with risk, you should do your own research before making a decision.