Bitcoin Price Analysis: Can this $880M Signal Keep BTC above $60k amid Dovish US NFP Forecast ?

Bears Fail $60k Breakdown Mission as Fed Chair Hint More Rate Cuts Ahead

Amid the rising geopolitical tensions in the Middle East, Bitcoin has been on a steady decline. On Thursday, October 4, Bitcoin price slid even further, marking its 6th consecutive losing day since the downtrend began on September 27.

However, Bitcoin showed resilience on October 3, sparking early hopes of an imminent trend reversal.

In the chart, the yellow patch shows how BTC instantly rebounded to $60,440 at the time of writing on October 3, after briefly retesting the $59,800 support level during the daily timeframe.

This resilience can be attributed to recent comments by US Fed Chair Jerome Powell, hinting at further rate cuts. Powell noted that inflation was moderating, suggesting the Federal Reserve might be more inclined to adopt a dovish stance going forward.

Broader economic conditions also set the table for further disinflation. The labor market is now roughly in balance. Longer-run inflation expectations remain well anchored.

– US Fed Chairman Jerome Powell, Sept 30, 2024

This aligns with market expectations of another rate cut after the 50 basis points easing announced on Sept 18.

More so, Bitcoin’s sharp rebound on Thursday paints a potentially more bullish picture compared to the weekly performance of the broader cryptocurrency market.

The TOTAL2 chart (excluding BTC) shows that the total market cap of altcoins has declined by 13.5% since the Middle-East crisis triggered a sell-off on September 27. By comparison, Bitcoin’s price trend as of October 3 reflects only a 10% decline over the same period.

Historically, a market bottom and bullish reversal are often signaled when Bitcoin starts outperforming altcoins during a broader market dip. This divergence in performance could indicate that BTC is nearing a critical support level, and traders may begin to reenter long positions.

Traders Mount $881M Support at $59k as NFP Forecast Sparks Rebound Hopes

In addition to the Fed chair’s comments, analysts widely expect that the next Non-Farm Payroll (NFP) data will likely move the Fed closer to a second consecutive rate cut.

On Friday, October 4, the US Bureau of Labor Statistics will release the latest jobs market data for September 2024.

In August 2024, Non-Farm Payrolls in the United Statesincreased by 142,000. According to TradingEconomics’ global macro models and analysts, the figure is expected to be between 130,000 and 142,000 for September 2024.

A lower-than-expected jobs figure could push the Fed towards more dovish monetary policy, increasing the probability of further rate cuts.

This dovish outlook aligns with trends in the Bitcoin derivatives market. Over the last 24 hours, bullish traders have taken on significant leverage, anticipating a potential rally ahead of the NFP data release on Friday.

The Coinglass chart above shows a notable long leverage cluster at the $59,500 price level, with $881 million in long positions. This substantial cluster suggests that many traders could face significant losses if BTC dips below this level.

With so much at stake, bullish traders may make frantic covering purchases, which could potentially drive a short-term rebound in Bitcoin price.

Two key factors could contribute to a rebound. Firstly, the Fed’s dovish tone coupled with weaker NFP data could bolster bullish sentiment.

More importantly, heavy leverage positioned around the $59,500 mark suggests traders will actively defend this support level, which could lead to a mild BTC price bounce in the days ahead.

Bitcoin Price Forecast: Historical Buy Trends Confirm $59,500 Support

Further analysis shows that Bitcoin’s price could stabilize around $59,500, supported by historical buying trends. Data from the Global In/Out of the Money chart below reveals how BTC holders have historically accumulated at this price point.

The chart illustrates that a large portion of Bitcoin holders entered the market between $51,340 and $60,056, where approximately 4.52 million addresses hold 1.87 million BTC. This area has traditionally acted as a significant demand zone, making it a key support level to watch.

If Bitcoin manages to hold this level, the next resistance zone appears to be between $60,056 and $62,303, where fewer addresses are currently holding BTC. A break above this level could trigger further bullish momentum, pushing the price towards the $65,000 mark.

In the event that the $59,500 support fails, the next major support zone would likely be around $51,340. However, with strong long leverage positions building up, Bitcoin bulls may prevent such a scenario from unfolding in the near term.

In conclusion, amid the rife geopolitical risks, Bitcoin’s price outlook remains cautiously optimistic as traders anticipate that dovish NFP data on Friday could support a second consecutive Fed rate cut decision. Within this set-up, if the $59,500 support holds, a mild short-term upswing toward $65,000 could be on the cards.