How will Friday’s job report affect the crypto market?

GB Market Commentary 06/10/2022

by Marcus Sotiriou

Bitcoin is struggling to overcome the $20,400 level and is hesitating at around $20,000. This is because yesterday we received the ADP National Employment Report, as shown below.

The ADP Report is a monthly economic data release that tracks levels of nonfarm private employment in the U.S. The ADP Employment Report is usually published two days before the Bureau of Labor Statistics publishes its monthly employment report, which is issued on the first Friday of every month (so it will be released this Friday). The ADP report is typically used as a preview of the more thorough statistics from the government agency, as it gets released first.

Why did this ADP report cause a stall in the crypto rally?

The ADP Report showed that, despite there being an overall downward trend in number of jobs, the number of jobs increased from last month. This can be seen in the chart above. This gives the Federal Reserve more ammo to carry on being aggressive in order to slow down the labour market, so they can get inflation under control. And an aggressive Fed is unfavourable for crypto and stocks.

But the JOLTS report released on Tuesday was bullish?

JOLTS data was bullish indeed, but in order for the Federal Reserve to be accommodative to the market again, we can’t just look at one report. The Fed wants to see a consistent slew of reports that show a balance in the labour markets.

The jobs data being released tomorrow will give us more clarity on the situation.