Falling cryptocurrencies like Bitcoin, Jasmy, and Avalanche could face further downsides after the U.S. published strong gross domestic product and jobless claims data.Looking ahead, the next crucial economic data to watch will come out on Friday, when the US will publish the personal consumption expenditure (PCE) data. PCE is the Fed’s favorite inflation gauge.
US GDP and jobless claims data
Another report revealed that the initial jobless claims dropped from 245,000 to 235,000 last week. That number was also better than the median estimate of 237,000.
On the positive side, Bitcoin has formed a falling broadening wedge pattern, a popular sign of a bullish continuation. This means that the coin may have some upside, but only if it crosses the descending trendline.
Still, economists expect the Fed will leave interest rates unchanged in its meeting next week. The CME Fed Watch tool estimates that the bank will cut rates in September.
A hawkish Fed would be negative for Bitcoin and other altcoins because these assets do well in a low-interest rate environment. For example, Bitcoin jumped to a record high of ,000 in 2021 as the Fed brought interest rates to zero.
These numbers mean that the Federal Reserve may decide to hold rates higher for longer than expected.
Implication on Bitcoin, Jasmy, Avalanche and altcoins
Two better than expected US economic data releases:
First and foremost, Q2 GDP grew by 2.8%, significantly higher than the consensus forecast of 2.0%.
Weekly jobless claims fell by 10,000 to 235,000.#economy #markets #econtwitter
Bitcoin (BTC) ‘s price retreated by almost 4% on Thursday and was trading at ,950. Other altcoins, like JasmyCoin (JASMY) and Avalanche (AVAX), performed worse, falling by over 10%. The two have slipped for four consecutive days and are hovering at their lowest swings since July 14.
Bitcoin rejected at a key level
In previous statements, Jerome Powell and other officials have expressed concerns that the economy was slowing. In particular, the Fed is more concerned about the labor market as the unemployment rate rose to 4.1% in June, its highest point since 2021.
