Bitcoin price rose back above US$63,000 earlier today and was once close to US$64,000, an increase of about 2.5%.
Bitcoin began to rebound around the time the United States released its monthly employment report last Friday. Data showed that non-farm payroll employment increased by 254,000 in September, exceeding the Dow Jones forecast of 150,000. Presto Research analyst Min Jung said: "The market's increasing optimism for a soft landing shows that the U.S. economy is currently in a 'Goldilocks' state."
BTCMarkets cryptocurrency analyst Rachel Lucas said the increase in liquidity was driven by improving market sentiment and increased expectations for another rate cut by the U.S. Federal Reserve in November. According to the Chicago Mercantile Exchange's (CME) FedWatch tool, the probability that the Fed will cut interest rates again to a range of 4.50% to 4.75% is 97.9%. Lucas said this often promotes more risk appetite among investors, benefiting assets like Bitcoin.
Lucas explained that another factor supporting Bitcoin’s rebound is the decrease in Bitcoin on centralized exchanges, which is typically associated with bullish price action as there is less selling pressure in the market.
"However, to sustain this recovery, Bitcoin needs to break through and hold the key resistance level of $64,500. If achieved, we may see a retest of the $66,000 price level," Lucas said.
However, both Lucas and Presto’s Jung said that geopolitical tensions in the Middle East would pose a significant risk to Bitcoin’s continued rebound in the near future.
“October has started off slowly — despite being historically a strong month for Bitcoin — but analysts are optimistic that the pace of the rebound will pick up as the month progresses,” Lucas said.
