These dates will be decisive
Bitcoin and crypto markets had their second red week in a row, driven by negative news about US crypto bank Silvergate. While the dollar index (DXY) weakened on Friday and the world’s largest stock index, the S&P 500, showed a strong recovery, Bitcoin and crypto went south.
But despite this brief decoupling of Bitcoin from macro action, investors should keep an eye on key dates this week. If the rally in the stock market continues, Bitcoin may follow suit and make up the ground lost in recent weeks.
Financial data that will be important for Bitcoin and Crypto
The state of the US labor market and not one but two speeches from Federal Reserve Chairman Jerome Powell will be the most important macro factors for the Bitcoin price this week.
Tomorrow, Tuesday 7 March at 10:00 a.m. EST, Powell will speak to the Senate Banking Committee on the economic outlook in the United States. Following the recent re-acceleration in the Consumer Price Index (CPI) and Personal Consumption Expenditure (PCE), market participants will be closely watching Powell’s choice of words, whose remarks could potentially move financial markets sharply.
Investors will be waiting for statements on the Fed’s monetary policy stance at the next interest rate decision on March 22. As Bitcoinist reported, the next FOMC meeting could be the most important of the year.
Wednesday 8 March at 10:00 a.m. EST, the Fed chairman will answer questions from the House Financial Services Committee, and could once again elaborate on his statements from the day before. But whether Powell really makes new comments on the Fed’s monetary policy remains to be seen.
At the same time on Wednesday, the Bureau of Labor Statistics will present the jobs report for job openings and the labor turnover survey (JOLTS) for the month of February. While the data is unlikely to have much, if any, impact on crypto market prices, it’s worth a look.
For the Federal Reserve, the continued strong US labor market is one of the most important factors to monitor. The estimate is 10.60 million vacancies. In the previous calculation period, the number of vacancies had been 11.01 million.
If US companies added more jobs, as they did last month, underpinning the strength of the US economy, this could provide a boost to financial markets. Recently, the market has tended to take a positive view of strong US jobs data.
Chinese and US Marco data in the second half of the week
On Thursday 9 March, new inflation rates will come out of China. With the Bitcoin price rising more than 2% last Wednesday in line with Chinese stocks after China’s manufacturing PMI came out extremely strong, it’s also worth looking east. If inflation data is lower than expected and warrants looser monetary policy from China’s central bank, it could mean a boost for Bitcoin.
Of great interest will be the updated US nonfarm payrolls (NFP) employment data on Friday at 8:30am EST for the month of February. A key question will be whether the February data confirms the January data that the US economy accelerated at the start of 2023, or whether it was a seasonal bias.
Forecasters expect 200,000 new jobs to have been created last month, which would be a sharp drop from the 517,000 jobs created in January. If the forecast is undershot, it will confirm the suspicion that January’s strong figures were a one-off effect.
In a bullish scenario, the US market turns out to be stronger than the estimate, which could lead to rising prices in the financial markets, as it would further reduce the likelihood of a recession.
This can also be confirmed with the US unemployment report, also released at 10:30am EST. According to Trading Economics, the unemployment rate is expected to hold steady at 3.4%, the lowest level since 1969.
At press time, the BTC price remained flat at $22,417.
Featured image from Chenyu Guan / Unsplash, chart from TradingView.com
