Key Points
- Bitcoin and other altcoins experienced pressure following a strong private payrolls report from ADP.
- Technical indicators suggest a potential surge in Bitcoin’s price, which could also lift other altcoins.
Bitcoin, along with other altcoins, faced downward pressure on Wednesday after the release of a robust private payrolls report from ADP.
Bitcoin (BTC) traded under the $100,000 mark, while prominent digital currencies such as Ethereum (ETH), Solana (SOL), and Binance Coin (BNB) fluctuated within a narrow range.
Impact of ADP Report
ADP, the leading payroll processing firm in the United States, announced that the economy added 183,000 jobs in January, surpassing December’s 176,000 and exceeding the projected 148,000.
This report was released just two days before the Bureau of Labor Statistics’ official nonfarm payrolls report. Economists anticipate this data to reveal the creation of 154,000 jobs in January, a decrease from the 256,000 jobs generated in the previous month.
The employment data in the U.S. is closely monitored by cryptocurrency and stock market investors as it significantly influences the Federal Reserve’s dual mandate of maintaining stable inflation and ensuring maximum employment.
A robust labor market could suggest that the Federal Reserve might maintain higher interest rates for a longer period, especially with inflation remaining above the 2% target. Despite the central bank’s indication of two rate cuts this year, strong job growth could postpone this timeline.
Bitcoin Price and Technicals
Bitcoin and other altcoins are also responding to the ongoing trade negotiations between the U.S. and China. The U.S. has already suspended tariffs on Mexico and Canada, which helped to stop Monday’s sell-off in the crypto industry.
Technical analysis indicates a potential surge in Bitcoin’s price, which could also drive other altcoins higher. The weekly chart shows that Bitcoin formed a cup-and-handle pattern, completed in November, and made a strong bullish breakout, reaching a record high of $109,200.
Currently, Bitcoin is forming a bullish flag chart pattern, consisting of a long vertical line and a rectangular consolidation. It has also remained slightly above the 50-day moving average and the ascending trendline that connects the lowest swings since October 2023.
If Bitcoin breaks above the upper boundary of the bullish flag pattern, it could trigger a strong rally, potentially pushing the price toward $120,000. Given Bitcoin’s influence on the broader crypto market, many altcoins would likely follow suit.