BitcoinBTC, Ethereum and other major cryptocurrencies surged in 2023, with the combined market adding around $250 billion – a rally that some say may have much longer to run.
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The bitcoin price is now hovering around $23,000 per bitcoin, up from under $17,000 at the start of the year. EthereumETH and the other top ten cryptocurrencies BNBBNB, XRPXRP, cardano, dogecoin, polygon and solana, also surged, with some smaller coins leaving bitcoin in the dust.
Now, after last week’s searing US jobs report raised fears of a return to aggressive Federal Reserve interest rate hikes, Fed Chairman Jerome Powell is set to deliver a speech. tomorrow in which he could deliver a wake-up call to bitcoin, ethereum, crypto and stock markets.
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“Bitcoin continues to lose momentum after the stronger-than-expected January jobs report forced the market to brace for two more rate hikes,” said crypto market analyst Yuya Hasegawa. at Tokyo-based Bitbank in comments via email.
Friday’s nonfarm payrolls report showed the United States added just over 500,000 jobs in January, blowing an estimate of less than 200,000. Earlier in the week, Powell announced a rise interest rates by a quarter of a per cent, the eighth consecutive increase but the smallest since March, and warned that “the job” – of stamping out inflation – “is not entirely done”.
However, Powell’s comments were seen by the market as more dovish than expected, sending bitcoin, ethereum, crypto and stocks sharply higher.
The jobs report “was an incredible surprise and raises many questions about what the Fed is going to do next,” said Kristina Hooper, chief global market strategist at Invesco. Reuters. “I think what’s causing some of the volatility is that the markets are trying to figure out how the Fed will perceive this.”
Tomorrow, Powell will deliver a speech that will be closely watched for signs he has turned warmonger in the face of a booming job market. On Wednesday, Federal Reserve Bank of New York President John Williams is also scheduled to speak.
“Given last week’s failure to completely suppress the bullish rate outlook from the market, Fed members will likely continue to remind the market that the fed funds rate will climb above 5% and be held there. throughout the year,” Hasegawa added.
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Although surprisingly strong jobs data last week raised fears of aggressive Federal Reserve action, some believe the better-than-expected numbers may just be “seasonal noise.”
“The meteoric rise of 517,000 in total employment was almost certainly a function of seasonal noise and the traditional rolling of the employment and wage environment at the start of the year and exaggerates what is already a robust trend in when it comes to hiring,” said Joe Brusuelas, chief economist at consultancy RSM US. in a customer note seen by Policy.
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