5 min readBitcoin is holding steady near 92k on Thursday after slipping below the key 90,000 level in the previous session as investors weighed up impressive Nvidia results, hawkish signals from the Federal Reserve, and awaited fresh jobs data.
The largest cryptocurrency trades at 91.7k at the time of writing, unchanged over the past 24 hours but down 10% over the past week. Other altcoins, such as Ethereum and BNB, remained under pressure, down 2.5% over the past 24 hours.
The recovery in Bitcoin comes as Nvidia reported stronger-than-expected revenue and earnings. The blowout numbers have alleviated concerns surrounding an AI bubble and overstretched valuations, lifting risk sentiment.
Nvidia posted Q3 revenue +62% at $57 billion with EPS at $1.30 vs $1.25 expected. Q4 revenue guidance was also ahead of forecasts at $65 billion. These figures have helped restore confidence in the AI buildout.
Why does this matter?
Nvidia is the world’s largest listed company and is a bellwether to the broader AI trade. Its influence goes far beyond that of a single stock and is considered part of a broader macro theme and risk catalyst. Furthermore, the close correlation between Bitcoin and US tech stocks (the Nasdaq 100) means a jump in the Nasdaq often supports the BTC price.
Hawkish FOMC minutes & jobs data up next.
Optimism surrounding the AI trade was offset by a more hawkish-sounding Federal Reserve. The minutes to the October Fed meeting showed that many policymakers had already ruled out a December rate cut. Expectations for a December cut fell below 30% after being priced in at near certainty just a month ago.
Attention is now turning to the September non-farm payroll report, which was delayed owing to the US government shutdown and is due at 13:30 GMT today. This is the only full official labour market snapshot to be released ahead of the December Fed meeting.
This gives the Fed an excuse to skip a rate cut, due to the “fog” as previously described by my Federal Reserve chair, Jerome Powell.
Tight money conditions drain liquidity from risk assets. As expectations for a Fed rate cut have slipped, BTC has fallen. If the Fed doesn’t cut rates in December, BTC could remain depressed around these levels.
Ethereum battles 3k as whales sell
Ethereum trades 2.5% lower over the past 24 hours and is testing the 3k psychological level support.
Ethereum addresses with a balance between 10K and 100 ETH have started to show signs of weakness, according to CryptoQuant data. Wallets have reduced their collective balance by over 150K ETH over the past four days. This distribution comes as E TH’s price has been hovering around its realised cost basis of $2,900, potentially prompting selling to cut losses or hold at break-even.
A meaningful move below the average buying price of these whales could accelerate selling pressure or could prompt whales to step in to defend the price.
Another key level to watch is the cost basis of accumulation addresses. These are wallets with no record of selling activity- their cost basis is at $2,860. Historically, ETH has recovered when its price approaches its cost base.
Meanwhile, institutional demand for Ethereum has also evaporated. ETH ETFs extended outflows on Wednesday for a seventh straight day, shedding over $1 billion.
Trading involves risk.
Author
Risk DisclaimerThe content provided here is for informational purposes only. It is not intended as personal investment advice and does not constitute a solicitation or invitation to engage in any financial transactions, investments, or related activities. Past performance is not a reliable indicator of future results.
The financial products offered by the Company are complex and come with a high risk of losing money rapidly due to leverage. These products may not be suitable for all investors. Before engaging, you should consider whether you understand how these leveraged products work and whether you can afford the high risk of losing your money.
The Company does not accept clients from the Restricted Jurisdictions as indicated in our website/ T&C. Some services or products may not be available in your jurisdiction.
The applicable legal entity and its respective products and services depend on the client’s country of residence and the entity with which the client has established a contractual relationship during registration.
