At 20:30 tonight, the United States will announce the July Non-Farm Employment Report. Bitcoin has been consolidating around $64,000 for several days, and this data may very well become the first catalyst to break the deadlock.
The current market expectation is that around 80,000 jobs were added in July, up from 57,000 in June, with the unemployment rate holding steady at 4.2% and average hourly wages expected to grow by 3.5% year-on-year. Looking solely at job additions, 80,000 is not strong, but it is enough to prove that the U.S. labor market is still slowly expanding.
What needs to be focused on tonight is which way the data will push the Federal Reserve.
The Federal Reserve previously maintained the benchmark interest rate at 3.50% to 3.75%, with some officials already supporting an interest rate hike. The market's bets on a rate hike in September are approaching fifty percent, and both sides are repricing around this employment report. After the data is released, the reactions of the U.S. dollar index and Treasury yields may be more valuable as a reference than Bitcoin's fluctuations in the first minute.
If job additions are significantly above 80,000 and wage growth remains high, it indicates that U.S. companies still have strong labor demand. The Federal Reserve would gain more policy space, and expectations for a September rate hike would rise. The U.S. dollar and Treasury yields might strengthen, while risk assets would bear the pressure of rising funding costs. For Bitcoin, this combination could easily suppress short-term valuations, and the support around $64,000 will be tested again.
The other scenario is that employment numbers fall below expectations while the unemployment rate rises to 4.3%. This would reinforce the judgment of a cooling labor market, and market bets on a rate hike might quickly retreat. The funding environment would improve, providing Bitcoin the opportunity to test upward movements based on sentiment recovery. However, whether the market can maintain this trend will depend on average hourly wages. Wage growth is related to service sector inflation and is a key basis for the Federal Reserve to assess the strength of its policies.
I'm more concerned about the revision of prior values.
June's job additions had already dropped to 57,000, and if the data for May and June is revised downward again, the market will realize that the slowdown in employment began earlier. Even if July's result approaches 80,000, changes in previous values could still alter the meaning of the entire report. In the past few non-farm payroll events, the market often first trades headline data, namely the most prominent job addition figures, and then re-evaluates direction based on the unemployment rate and revisions of previous values.
From the market perspective, Bitcoin's recent volatility has continued to narrow, and market sentiment is cautious. At the same time, on-chain chips are moving at an accelerated pace. K33 data shows that approximately 890,000 BTC have been transferred in the past 7 days, and active supply has risen to a yearly high. Prices remain calm, yet chips are being redistributed, which usually indicates that the market is waiting for new pricing basis.
Therefore, tonight, we can focus on four positions: job additions of 80,000, an unemployment rate of 4.2%, average hourly wages year-on-year of 3.5%, and Bitcoin's performance around $64,000.
My judgment is that as long as the employment data is close to expectations, the market's reaction may be relatively limited, and Bitcoin will still maintain a range consolidation. What can truly bring direction is if employment, wages, and revisions of previous values all lean to one side. At that time, expectations for Federal Reserve policy will adjust quickly, and BTC may also end this period of low volatility.
In tonight's Non-Farm Payrolls, the focus is on employment data, but the core of trading is still interest rate expectations.
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