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Cryptocurrency Market Slumps Following Robust US Jobs Data
Cryptocurrency Market Slumps Following Robust US Jobs Data
The cryptocurrency market, including Bitcoin (BTC), Ethereum (ETH), and various altcoins, suffered a significant decline on June 7 after U.S. employment data beat expectations. Despite the initial decline, many traders believe this is simply a “jolt” before the market resumes its bullish trajectory.
Pseudonymous cryptocurrency trader the Chief of Crypto, who has 848,000 followers on X (formerly Twitter), commented on the market movement, noting: “Strong sell-off in support. Alts suffered the most.” They suggested that this “looks like a shakeout,” a term used to describe a scenario in which large numbers of investors sell off simultaneously, often triggered by economic or market uncertainties.
The sell-off coincided with the release of the U.S. jobs summary report, which revealed stronger-than-expected job gains for May. This contradicted the predictions of some crypto analysts who had predicted that weaker jobs data would prompt the Federal Reserve to consider lowering inflation rates, potentially driving Bitcoin to new highs.
Markus Thielen, head of research at 10x Research, had previously speculated on June 5 that a weaker jobs report could lead to rate cuts. He suggested that if the consumer price index (CPI) year-over-year rate was 3.3% or lower, it would likely push Bitcoin to all-time highs. However, actual employment data painted a different picture, showing mixed signals that Thielen said did not directly cause the cryptocurrency market to crash.
“Cryptocurrencies sold off late Friday without much of a catalyst,” Thielen said. She explained that U.S. employment data is “mixed,” with the unemployment rate rising to 4.0% despite an increase in the number of jobs added, attributed primarily to the increase in part-time workers.
The U.S. Bureau of Labor Statistics reported an increase of 272,000 jobs in May, while the unemployment rate increased 0.1%. This conflicting data has contributed to a complex economic outlook, leading to uncertainty in the cryptocurrency market.
Despite the broader market downturn, Bitcoin it remained unchanged over the past 24 hours, settling at $$69.39. Ethereum fell slightly, falling 0.53% to $3,669. Over the past week, altcoins have suffered even bigger losses, with Pepper plummeting by 18%, Solana down 3.7% e Dogemoneta down 10.7%, according to CoinMarketCap data.