Bitcoin (BTC) turned higher ahead of the U.S. September nonfarm payrolls report. By midday in Asia on Oct. 2, BTC was trading around $86,560 after rising as high as $86,794 during the session, rebounding more than 4% from an intraday low near $83,200 and moving back toward the previously watched $87,000 resistance zone.
Markets are now focused on the U.S. September jobs report. The Bureau of Labor Statistics is set to release the data at 8:30 p.m. Taipei time. A Reuters survey estimates that U.S. nonfarm payrolls increased by about 90,000 in September, well below August’s 162,000, while the unemployment rate is expected to stay at 4.1%.
October Fed hike odds have dropped to 25%
One of the main drivers behind Bitcoin’s rebound is a rapid pullback in expectations for another Federal Reserve rate increase. Reuters reported that traders now price roughly a 25% chance that the Fed will raise rates again at its Oct. 27-28 meeting, down sharply from about 70% a week earlier.
Reuters said the shift was driven in part by softer-than-expected PCE inflation data and comments from New York Fed President John Williams and Fed Vice Chair Philip Jefferson, who said there is no urgent need for back-to-back rate hikes. Even so, the market still expects the Fed could raise rates once more later this year, with December seen as the more likely window.
Payrolls matter, but wage growth is also in focus
According to the Reuters survey, current market expectations for September are:
- Nonfarm payrolls: 90,000
- Unemployment rate: 4.1%
- Average hourly earnings growth: about 3.2% year over year
Forecasts remain widely dispersed. Estimates for payroll growth range from about 35,000 to 180,000, leaving room for a sizable surprise in either direction.
Average hourly earnings are another key variable. If hiring slows and wage growth does not reaccelerate, markets may cut October hike expectations even more. If both payrolls and wages come in well above expectations, rate-hike positioning could return quickly.
Bitcoin has already cleared $85,000. The next question is whether it can hold it.
Earlier in the day, the focus was on whether BTC could break above $85,000. That has now changed. Bitcoin is already trading above $86,000, which shifts the meaning of tonight’s payrolls release: is this a genuine breakout, or a pre-data positioning move?
BTC’s intraday range currently runs from about $83,200 to $86,794, a swing of more than 4% in a single day. If tonight’s data comes in soft and Fed hike odds fall further, Bitcoin could retest $87,000 and the area near $87,700, which the article identified as roughly where the year opened and where selling pressure had appeared several times before. If payrolls come in much stronger than expected, the gains above $86,000 could be given back quickly.
10-year Treasury yields are still near 5.25%
Even with near-term rate-hike expectations easing, financial conditions remain tight. Reuters’ latest Asia-session data showed that the U.S. 10-year Treasury yield had earlier climbed to 5.34%, its highest level since 2002. It later pulled back in Asian trading but remained around 5.25%. The U.S. dollar was also holding near a roughly 17-month high.
That leaves a split in the macro picture:
- Short end: expectations for an October Fed hike have fallen
- Long end: the 10-year Treasury yield is still above 5.2%
For Bitcoin, the first is supportive. The second still raises the opportunity cost of holding non-yielding assets. In other words, BTC’s jump to $86,500 does not mean macro pressure has fully disappeared.
Asian equities fell while BTC outperformed
Bitcoin’s rally did not come with a broad rise in risk assets. During Asian trading on Oct. 2, the MSCI Asia-Pacific ex-Japan index fell about 0.5%, while the Nikkei dropped about 0.7% as markets waited for the U.S. employment report.
Against that backdrop, BTC climbed from $83,200 to around $86,700, clearly outperforming Asian equities in the short term. The original report said this points to stronger momentum inside the crypto market itself, though tonight’s payrolls release could still take over as the main price driver.
Three scenarios the market is watching
The article laid out three simplified scenarios for tonight’s data:
- If payrolls come in clearly below 90,000 and wage growth is also soft, October Fed hike odds could fall further and BTC may get a chance to test $87,000 to $88,000.
- If the data broadly matches expectations, BTC may stay in a high range between $85,000 and $87,000 while markets wait for later inflation data and Fed signals.
- If payrolls are far above expectations and wages accelerate, markets may rebuild rate-hike bets, Treasury yields and the dollar could rise, and Bitcoin’s latest surge may face profit-taking.
Tonight’s report will test whether $85,000 can become support
The key level has shifted from whether Bitcoin can break $85,000 to whether it can turn that level into support. By midday in Asia on Oct. 2, market structure had already changed from the morning session, with BTC rallying from about $83,200 to above $86,500.
The payrolls release will now test whether $85,000 can move from a former resistance level to a new support zone. If BTC remains stable above $85,000 after the data, the article said the move may be more than a short squeeze. If it quickly falls back below $85,000, or even returns to the $83,000 area, then the Asia-session breakout would look more like positioning ahead of the event.