The growing bearish influence on the market has successfully led to a 5.65% drop in the BTC price over the past seven days. Currently, the Bitcoin market cap is hovering around $1.10 trillion.
Like 24 hours liquidation is on the brink of $100 million, will the Bitcoin sell-off rally lead to a drop to $50,000? Let's find out.
Bitcoin Price Dynamics
Bitcoin price has fallen by 1.14% in the last 24 hours and is currently trading at $56,025. Bitcoin price is forming an intraday doji candle in an attempt to stay above $56,000.
On the daily chart with a doji candle, BTC price is hanging around the $55,852 base level of the Fibonacci retracement tool. If BTC price manages to close the day with a doji candle, the probability of a reversal will increase significantly. In addition, a potential morning star for a recovery rally could be observed.
Despite the ongoing bearish cycle, the daily chart shows a bullish flag. However, the support line is far from the current price and could lead to a drop in price to $52,500.
US Labor Market FUD Loses Bitcoin
With the U.S. employment report due out on Friday, the deciding factor in the upcoming rate cut debate is the fact that if the report shows a shortage of jobs, reflecting a slowing economy, the chances of a rate cut will increase, giving the economy a boost. A rate cut will make credit more readily available and increase investment in risky assets like Bitcoin.
Thus, at the potential rate, the price of BTC will most likely rise sharply and reach the $60,000 mark.
However, since the FOMC meeting is in 12 days, CME Fed Watch Tool shows a 41% chance of a 475-500 basis point rate cut, meaning the short-term panic over the jobs data is likely to fade next week, leading to a recovery.
Will BTC Price Stay Above $55K?
Despite the ongoing decline, the BTC price reflects the indecision in the market with a doji around $55,500. Therefore, the chances of Bitcoin experiencing a crash above the $55,000 mark are significant.
However, a slight correction is possible if sentiment deteriorates around the jobs report. On the positive side, a slowdown in the jobs sector will lead to a sentimental rally in the crypto market. Increased chances of a rate cut will push the BTC price to $60,000.
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