Bitcoin Price Forecast: BTC Forms Skittish Pattern on Non-Farm Payrolls Report

Ibrahim Ajibade
Updated: Jan 5, 2024, 12:27 GMT+00:00

On-chain data indicates both Bitcoin miners and whales assumed cautious positions ahead of the US Non-Farm Payrolls Report. Here's how BTC price could react

Bitcoin Price

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Key Insights:

  • Bitcoin’s price rebounded to as high as $44,300 on Friday morning, marking an 8% increase from the 14-day low of $40,870 recorded on January 3.
  • On Friday, January 5, the U.S. Bureau of Labor Statistics is scheduled to release the Non-Farm Payrolls (NFP) report for December 2023.
  • On-chain data indicates that both Bitcoin miners and whale investors have assumed a cautious position ahead of the U.S. jobs report.

Bitcoin’s (BTC) price swiftly recovered above the $44,000 mark after dipping to the 14-day low on January 3. On-chain data trends provide early insights into how Bitcoin’s price might react to the upcoming U.S. Non-Farm Payrolls report scheduled for January 5.

Will a negative jobs report prompt another price dip for BTC?

Market Analysts Expect a Negative Non-Farm Payrolls Data

Market analysts and investors overwhelmingly anticipate a decline in December NFP compared to the previous data for November. The data released on December 12 showed that 199,000 Non-Farm jobs were added in November 2023, surpassing market expectations by 49,000 jobs. This positive outcome resulted in a 4% gain in BTC price within subsequent 24-hour timeframe.

The current consensus figure for December 2023 is 170,000 Non-Farm jobs, a 29,000 decline from the previous month, as per data compiled by TradingEconomics.

This monthly report is closely followed by economists, policymakers, investors, and financial markets. Market reactions to Friday’s NFP report can be particularly significant, potentially influencing decisions on potential rate cuts. The U.S. Fed has maintained unchanged interest rates for the last two consecutive months.

If job creation figures are lower than expected, signaling a contracting economy, it could accelerate discussions about rate cuts. On the other hand, higher-than-expected figures could mean that the economy is still overheated, pushing back talks of rate cuts further into the horizon.

Miners Offloaded BTC Ahead of December Non-Farm Payrolls Report

Bitcoin miners have intensified their selling trend throughout the week, indicating a potential BTC price pullback.

According to data from IntoTheBlock, recognized miners’ aggregate Bitcoin reserves stood at 1.96 million as of December 29. However, recent data shows miners offloaded 30,000 BTC, reducing their cumulative balances to 1.93 million BTC as of January 5.

Bitcoin (BTC) Miner Reserves vs. Price | Source: IntoTheBlock
Bitcoin (BTC) Miner Reserves vs. Price | Source: IntoTheBlock

When valued at the current Bitcoin price of $44,300, miners have sold off 30,000 BTC, worth approximately $1.32 billion this week alone. This influx of coins could add to downward pressure on Bitcoin’s price if the NFP data triggers a negative response across risk asset markets.

Corporate Entities Continue Selling Despite BTC Price Recovery

Bitcoin’s price has recovered to the $44,000 territory after a panic sell-off. Despite the rapid 8% price resurgence, on-chain data shows that corporate entities have continued to sell off their holdings.

Bitcoin (BTC) Large Holders Netflow vs. Price - Source: IntoTheBlock
Bitcoin (BTC) Large Holders Netflow vs. Price | Source-IntoTheBlock

According to data from IntoTheBlock, BTC Large Holder netflow decreased significantly this week. Large Bitcoin investors offloaded BTC worth $252 million on Thursday alone.

In summary, on-chain data trends indicate an ongoing selling trend among corporate entities and Bitcoin miners ahead of the Non-Farm Payrolls report. This suggests that key stakeholders in the Bitcoin ecosystem are preparing for potentially negative price action in the days ahead.

BTC Forecast: Bitcoin Price Reaction to NFP Report

When miners and crypto whales offload large quantities of coins in a short period, it dilutes market supply. If retail traders cannot match this added supply with fresh demand, BTC price stands the risk of a major correction following the Non-Farm Payrolls report.

Based on this data-driven analysis, BTC price is at risk of another $41,000 retest in the coming days.

Bitcoin (BTC) Price Forecast ahead of Non-Farm Payrolls Report | Source: TradingView
Bitcoin (BTC) Price Forecast ahead of December Non-Farm Payrolls Report | Source: TradingView

However, technical indicators suggest that bulls may establish a significant initial buy-wall around the $43,100 area. Bitcoin is currently trading at $43,934, remaining above the 20-day Simple Moving Average (SMA) of $43,161.

If bears flip that support zone, it could lead to a potential downswing toward $41,000. On the upside, bulls could regain control if BTC breaks out of the $45,000 resistance. Positive news about the SEC verdict on Bitcoin spot ETF applications could also turn the bearish momentum and trigger a move toward $50,000.

About the Author

Ibrahim Ajibade Ademolawa is a seasoned research analyst with a background in Commercial Banking and Web3 startups, specializing in DeFi and TradFi analysis. He holds a B.A. in Economics and is pursuing an MSc in Blockchain.

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