The turmoil in the cryptocurrency market continues to make headlines as Bitcoin (BTC) suffers a near 1.75% decline, dipping its value down to $29,084 on August 3rd in midst of roller coaster trading session. Not even a glimmering prognosis of the approval of a Bitcoin spot ETF by a digital publication analyst could withstand the US Dollar’s current robustness and push this crypto leader upward.
Observers maintain rapt attention to the forthcoming Nonfarm Payrolls (NFP) report set for release at the conclusion of the week, adding an extra layer of suspense in Bitcoin’s already volatile climate. Inner workings of this financial spectacle are an interplay of several factors, major ones being the anticipated Bitcoin ETF and the reigning strength of the US Dollar.
The increased probability of a Bitcoin ETF coming into existence, a percentage that saw a rise from 50 to just about 65 this year, is an eyebrow-raiser. Particularly considering it’s spurred by such financial behemoths as BlackRock and Fidelity pushing in ETF applications, signaling traditional finance’s escalating engagement with cryptocurrency.
Recent verdicts by the Securities and Exchange Commission (SEC), including sanctioning the well-renowned Coinbase’s Bitcoin trading platform, could suggest a pivoting of regulatory strategy favouring crypto-centric products. Notwithstanding, the conclusion of SEC’s lawsuit versus Grayscale could also sway market sentiment.
Although these developments hint at Bitcoin’s brighter future, the shadow cast by the US Dollar’s vigour has been dampening the cryptocurrency’s immediate performance.
Regarding the latter, the US Dollar Index (DXY) surged 0.18%–the third consecutive day of increase–reaching $102.78, the greatest it has been in nearly 20 days, beating six principal currencies. The root behind this upshoot is attributed not merely to the optimism in the face of the upcoming NFP data but also the anticipation that the Non-Farm Employment figure would hit around 203K (a 6K slump from June) and the Average Hourly Earnings in July would be 0.3%, down from June’s 0.4%.
Such estimations of favourable outcomes have already stirred the NFP data pricing in. This upbeat attitude is largely fuelled by the latest report revealing July’s ADP Non-Farm Employment Change figure to be 324K, overtaking the predicted 184K estimation. This unsuspected surge has made the Dollar stronger, putting a dent in BTC/USD’s price.
A closer look at Bitcoin’s 4-hourly timeframe unfolds a restricted trading range. Despite suggestions of potential support near $28,700 amidst continued drop, Bitcoin could tumble to $28,200 if it breaches current barriers.
Yet, caution must be exerted as cryptocurrencies are notoriously erratic and need exhaustive research before investment is considered. Stay abreast of the shifting digital landscape here, where you can explore a carefully curated list of the top 15 digital assets to watch in 2023.
Source: Cryptonews
