Three reasons why Bitcoin jumped to $86,000 this week

In a move that has bolstered Bitcoin bulls across the market, Bitcoin pushed back above $86,000 this week, its highest level since January. 

A weak jobs report took selling pressure off. 

This is the big reason. The US added just 29,000 jobs in September — against the 90,000 expected — and unemployment ticked up to 4.2%. A soft job market means the Federal Reserve has far less reason to keep raising interest rates. 

Traders are positioning themselves accordingly. Just a week ago, they saw a 71% chance that the Fed would raise rates, but now they reckon there’s an 81% chance that the level holds. 

Moreover, remember last week, when we said sky-high bond yields were acting like gravity on Bitcoin? That gravity just got a little lighter, and Bitcoin floated up.

Everything risky rallied together. 

Bitcoin’s rally wasn’t a solo run. The same jobs news sent stocks flying, with the Nasdaq 100 closing at a record high Friday, and markets from Tokyo to New York jumped. 

It’s definitely worth noting that a few weeks ago Bitcoin was going its own way, apart from tech.

Can’t tell if $87K breaks or bounces? Here's the approach that doesn’t need you to guess:

“Uptober” is in the air. 

October is historically Bitcoin’s strongest month of the year, and traders are positioning accordingly.

Narratives move money, and right now the narrative is pushing people to buy. Before you go longing Bitcoin, however, there’s a small catch. Bitcoin spiked to around $87,000 but then slightly reversed. That’s the second time in a week that it stalled at the same spot, just under the late September high of $87,400. 

There are real reasons that pushed Bitcoin to have a good week, even if it didn’t break out to a new high. What matters next, however, isn’t the jump — it’s whether Bitcoin can finally close above $87,400 instead of bouncing off it. 

Clear that, and the next leg opens up. Keep getting rejected there, and this stays in a range.

Catch you next week,

The Rhino Research Team