Bitcoin price overcomes $50K, stocks slide after disappointing US jobs report

S&P 500 fell to intraday highs on Sept. 2, while Bitcoin (BTC), climbed to its highest levels for more than three months. These moves were made after a September 3rd report showed that the United States had added fewer jobs than expected, which lowered the likelihood of the Federal Reserve starting to unwind its stimulus program for this year.

According to the U.S. Bureau of Labor Statistics, nonfarm payrolls increased by 235,000 in August. This was against the expectations of 733,000 jobs. The unemployment rate was still 5.2% lower than the 5.4% in the previous month.

OUCH! The US economy added only 235,000 jobs, compared to 733k as expected. This is the slowest growth in 7 months due to Delta surge. Minimum prior mth revised higher to 1053k, from 943k. As expected, the unemployment rate drops to 5.2%. The average hourly earnings rose by 0.6% MoM, compared to +0.3% exp.– Holger Zschaepitz (@Schuldensuehner) September 3, 2021

What is the Delta variant FUD of Bitcoin pump?

In August, the hospitality and leisure industry saw no job growth, compared to its average monthly increase of 350,000 jobs per month forbitcoin rises after jobs report the past six months. The restaurant sector saw 42,000 job losses, indicating concerns about COVID-19s fast-growing Delta variant.

In anticipation of a slowdown within the U.S. job sector, Bitcoin rose by 3.41% and reached $50,961

In the second quarter 2021, the most well-known cryptocurrency in the world struggled amid a global economic recovery from the pandemic. After facing additional headwinds such as a complete crypto ban in China, and Elon Musks anti Bitcoin tweets, it fell to $65,000 from below $30,000

The global economic recovery sparked speculation that central banks might end their huge monetary support. Jerome Powell, the Chairman of the Federal Reserve in the United States, stated that the Fed would start to taper by 2021 if the economy achieves maximum employment.

However, the Delta variant continues to dent hopes for a steady economic recovery and labor market recovery. The September 3rd job data suggests that the U.S. central banks will need to keep its $120 billion monthly asset purchase program.

The outlook pushed the U.S. Dollar lower, and non-yielding hedge assets such as Bitcoin and gold rose.

“The cross-over over the $50,000 price mark has revealed 2 crucial discoveries for digital currency,” stated Petr Kozyakov (co-founder and CEO) of Mercuryo, a payment network.

“One, that the top cryptocurrency still has the intrinsic features that attract buyers and investors, and two, that the increased price valuation hasnt yet eliminated volatility surrounding the digital asset.”

Kozyakov predicted that Bitcoins rise as a well-known financial asset on Wall Street and loose monetary policies would drive its prices up to $55,000 in the short term and $70,000 over the long term.

Unemployment benefits expiring soon

This extremely weak NFP report was released just days before the planned termination of federal unemployment benefits, which the U.S. administration had put in place to mitigate the economic damage from the pandemic.

Additionally, the additional aid of $1,200 per person to unemployed Americans will end on Sept. 6. This will effectively end aid to approximately 7.5 million people, as Delta variant cases in some parts of the United States are increasing.

Goldman Sachs pointed out that Americans were also discouraged from applying for work by unemployment benefits throughout July. Goldman Sachs predicted that the Sept. 6 termination would result in nonfarm payrolls increasing to 1.5 million by 2021.

Mid-September will see the next Federal Reserve meeting. It is expected that the Fed will shed more light on its taper plans, in light of the weaker NFP data.

You should research all aspects of trading and investment before making any decisions.

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