Key points:
- Bitcoin is facing the possibility of lower lows amidst a weakening Relative Strength Index (RSI) and a potential retest of the $100,000 support level.
- Market sentiment suggests limited expectations for a swift rebound in BTC price, with geopolitical and economic uncertainties contributing to the cautious outlook.
- Upcoming US labor market data, particularly the Nonfarm Payrolls report on June 6, is anticipated to introduce increased volatility into the market.
Bitcoin (BTC) rebounded to around $103,000 before the Wall Street open on June 6, recovering from recent losses.
Trader: BTC price “breakdown has begun”
Data from Cointelegraph Markets Pro and TradingView indicated that BTC/USD maintained its upside momentum after rebounding from $100,500 near the June 5 daily close.
Recent market volatility was partly attributed to a public discussion between former US President Donald Trump and SpaceX CEO Elon Musk.
Despite Bitcoin’s ability to hold the $100,000 support, these events heightened existing concerns about a more significant price correction.
According to trader Roman, the higher timeframe BTC/USD chart is showing “bearish signs all over it.”
“The $BTC breakdown has begun!” he told followers on X.
“Eyeing 95k and possibly lower. Depends what happens when we consolidate.”
Trader Friedrich echoed these sentiments, suggesting that sub-$100,000 levels could be the next target, describing the price breakdown as “annoying.”
“What to expect? A retest around 105Ks and bleed toward 87K. Or a reclaim above 105.8K-106K and the journey toward a new ATH begins,” his X post read.
Even analysts with a generally optimistic outlook on the market acknowledge the potential for short-term weakness.
Market commentator Kevin Svenson pointed to a decline in Bitcoin’s Relative Strength Index (RSI) on daily timeframes.
“The daily RSI structure is an important indicator to follow,” he wrote.
“Right now, the daily RSI is still pointing downward, but we may be a week away from a potential reversal signal.”
Nonfarm payrolls tipped to excite risk assets
Market participants are also closely monitoring upcoming US macroeconomic data releases as potential catalysts for volatility.
The Nonfarm Payrolls (NFP) report, which reflects the strength of the labor market amid prevailing high-interest rates, is of particular importance.
“The morning NFP & Unemployment reports are likely going to be catalysts for volatility,” Keith Alan, co-founder of trading resource Material Indicators, argued the previous day.
Alan suggested that any increases in unemployment could ultimately benefit crypto and stock markets, as they might prompt the Federal Reserve to consider easing its hawkish monetary policy sooner rather than later.
“I think the market would like to see a strong economy even if it means rates are high for longer, but nobody would be surprised by a .1% bump in the UNRATE, but anything bigger would turn up the heat on the FED to cut in Q3,” he said.
Regarding Bitcoin, Alan stated that he had not “ruled out” a potential decline to as low as $93,000.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.