QCP Capital said the macro backdrop has shifted sharply over the past three weeks, with markets moving away from expectations of a Federal Reserve rate hike in October and toward a view that rates will likely stay unchanged. The firm pointed to weaker U.S. labor data in September, including nonfarm payroll growth of just 29,000 versus an expected 84,000, a rise in the unemployment rate to 4.2%, and slower wage growth of 3.0% year over year, the lowest since May 2021. The three-month average for job creation fell to 50,700, about one-third of the level seen a year earlier, helping push the probability of an October hike down to 22%.
In crypto markets, QCP said Bitcoin still needs to establish support above $87,200 before a fresh uptrend can be confirmed. Ether is trading around $2,725 within a $2,650 to $2,800 range, with the broader setup described as cautiously constructive. The firm said Wednesday’s release of the Federal Reserve meeting minutes will be the main catalyst this week, as traders look for signs on whether earlier hawkish dissent reflected the Fed’s actual stance. TOKEN2049 in Singapore and the October 14 CPI release are also on the market’s radar.
QCP Capital said on Oct. 5 that the macro narrative has shifted materially over the past three weeks, with markets moving from expectations of a Federal Reserve rate hike in October to a view that hike expectations have largely faded and rates are likely to remain unchanged.
Labor data weakens the case for an October hike
According to QCP, U.S. nonfarm payrolls rose by just 29,000 in September, well below the expected 84,000. The unemployment rate climbed to 4.2%, while year-over-year wage growth slowed to 3.0%, the lowest reading since May 2021. The three-month average of job gains fell to 50,700, roughly one-third of the level seen a year ago, helping drive the probability of an October rate hike down to 22%.
Treasury yields remain elevated
Even so, QCP noted that the U.S. 10-year Treasury yield is still as high as 5.25%, citing Treasury supply and term premium dynamics.
Key levels for BTC and ETH
In crypto, the firm said Bitcoin still needs to hold above $87,200 to confirm the next round of upside. Ether, meanwhile, is trading near $2,725 and remains within a $2,650 to $2,800 range. QCP described the broader setup as cautiously bullish.
What the market is watching this week
QCP said the Federal Reserve meeting minutes due on Wednesday will be the main catalyst this week, with traders focused on whether earlier hawkish dissent reflected the central bank’s true stance. The firm also flagged TOKEN2049 in Singapore and the CPI data scheduled for Oct. 14 as key events to watch.
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