According to CoinDesk: Despite a lack of bullish momentum for Bitcoin (BTC) following a disappointing U.S. nonfarm payrolls (NFP) report on Friday, market sentiment remains positive. The underwhelming data indicate a potential end to the Federal Reserve's monetary tightening, which may bode well for the cryptocurrency.
Greg Magadini, Director of Derivatives at Amberdata, sees no reason to not be optimistic about Bitcoin in an email. A reason he cites for his optimism is the decrease in stock market volatility indices following Friday’s payroll data. The Labor Department job report showed a slowdown in job creation, logging only 150,000 jobs in October compared to 297,000 in September. The jobless rate rose to 3.9%, while average hourly earnings also showed slower growth, suggesting continued disinflation.
This development makes it unlikely for the Federal Reserve to hike interest rates again, a scenario seen as positive for risk assets including cryptocurrencies. Over the past year, a 525 basis points rise in rates by the central bank, to 5.25% as of March, was partially responsible for the crypto market downturn.
According to Magadini, the diminishing volatility in the U.S. stock and bond markets also contributes to the outlook for Bitcoin's continued growth. He also noted that the VIX indicator for the S&P 500 has fallen from 21.13 to 14.19 over the previous five trading days. At the same time, the MOVE index, which measures Treasury bond market volatility, fell from 132 to 118, as per TradingView data.
In Magadini's view, the diminishing impact of Middle Eastern conflicts on market movements, combined with the reduction in traditional market volatility, particularly in bonds, could alleviate global liquidity stress and encourage risk-taking. Bitcoin is currently trading at $34,890, a meager drop of 0.4% on the day. However, its value has surged nearly 25% in the past month, peaking over $36,000 at one point.
