Bitcoin’s price is on a wild ride today, fluctuating around the $27,700 level. Live Bitcoin feeds and TradingView show us the latest movements of BTC in the past 24 hours. Welcome to this market analysis, where we will explore the macroeconomic factors that affect the value of assets. Let’s dive deeper into the issues behind the numbers.
The financial indices in the US economy are a source of concern, as the latest data shows a slowdown in job growth and a rise in unemployment. According to the Bureau of Labor Statistics, the US economy added only 235,000 jobs in August, far below the expectations 720,000. The unemployment rate dropped slightly to 5.2 percent but remains above 3.5 percent.
The outlook for the coming months is still being determined, as there are challenges for the labor market. Some economists have revised their forecasts for September and October, citing the impact of supply chain disruptions. Others have pointed to the positive signs of rising wages, labor force participation, and job openings. The Federal Reserve is also closely monitoring the situation as it weighs whether to taper its stimulus measures later this year.
The financial indices are not only reflecting the current state of the economy but also influencing it. The stock market, for example, reacted negatively to the disappointing jobs report, as investors feared slower recovery and lower corporate earnings. On the other hand, the bond market saw lower yields and higher prices as traders anticipated a more dovish stance from the Fed. These movements have implications for consumer spending, business investment, and inflation.
The US market is at an extreme fear level
Also, the US market is now at an extreme fear level. You know, with crypto, we have a fear and greed index, but there’s one for stocks that not a lot of people pay attention to. I saw this with yesterday’s crash. Officially, we are in extreme fear level for the US market, which also is not good, right? Of course, it's not good. Since June of this year, things have started coming down. DXY is skyrocketing, and you have all these overprinting issues, and then you know, you had a government shutdown thing that we avoided, but still, that means we have more overspending. It’s just a non-stop FUD train right now.
Bitcoin is signaling a massive upward movement
Bitcoin is getting stronger, and everyone can see it. It’s not just the enthusiasts but also the experts, the bankers, and the long-term investors who recognize its value. Bitcoin was designed for this exact scenario: to give people an alternative to the chaotic and irresponsible monetary policies of the governments and central banks around the world.
Bitcoin is a trustless and decentralized system that does not rely on the whims of those in power. It is a solid foundation that will not collapse like a house of cards. That’s why Satoshi Nakamoto created Bitcoin and that’s why more and more people are flocking to it.
My thesis is that Bitcoin has the potential to reach 200,000, a 6X increase from its current level. And I have evidence to back it up. There is a correlation between the performance of the S&P 500 (SPX) and Bitcoin. This chart shows how they move together and what it predicts for the future. Right now, it indicates a huge upward trend for Bitcoin. This is a bullish signal that suggests it’s time to be more aggressive and less cautious. I agree with this sentiment because Bitcoin has strong fundamentals and resilience despite the macroeconomic challenges.
Bitcoin fundamentals keep getting stronger
Bitcoin is becoming stronger daily as its fundamentals improve and its adoption grows. One of the key factors that drives the value of Bitcoin is its limited supply of 21 million coins, which is gradually reduced by the halving events that occur every four years. The next halving event is expected to happen in April 2024, when the block reward for miners will drop from 6.25 BTC to 3.125 BTC. As history has shown, this will make Bitcoin more scarce and more valuable. After each of the previous three halvings, Bitcoin’s price has increased significantly in the following months and years.
Another factor that boosts the demand for Bitcoin is the possibility of a spot Bitcoin ETF in the U.S., allowing investors to buy and sell Bitcoin directly through a regulated exchange-traded fund. The U.S. Securities and Exchange Commission (SEC) has rejected all spot Bitcoin ETF applications so far. Still, it has also delayed its decision on several new ones, including one from BlackRock, the world’s largest asset manager. If the SEC approves a spot Bitcoin ETF, it could open the door for more institutional and retail investors to enter the Bitcoin market, increasing its liquidity and price.
Moreover, Bitcoin is attracting more and more people looking for a haven from the inflation and currency devaluation plaguing many countries around the world. Inflation is real right now, as the consumer price index (CPI) in the U.S. rose by 5.4% in September 2023, the highest annual rate since 2008. Many fiat currencies are losing their purchasing power as governments and central banks print more money to stimulate the economy. Gold, traditionally seen as a hedge against inflation, has also been losing its value, as it fell by 6.1% in the last 30 days.
Disclaimer: This content is for educational purposes only and should not be considered financial or other advice. Always do your due diligence before investing.