Crypto market rally beckons as US non-farm jobs double expectations


The global crypto market capitalization rebounded above the $1.6 trillion milestone on Feb. 2 as the latest non-farm payrolls figures cast doubt on U.S. Fed Chief, Jerome Powell’s recent comments. 

The job figures in the latest non-farm payrolls report suggest crypto bulls could position for positive price action.  

Powell’s comments send crypto prices into $90 billion tailspin 

On Feb. 1, the global crypto market capitalization dipped toward the $1.5 trillion area. This came barely 48 hours after Powell made controversial statements suggesting postponing rate cuts beyond March 2024, as widely predicted. 

“Based on the meeting today, I would tell you that I don’t think it’s likely that the committee will reach a level of confidence by the time of the March meeting to identify March as the time to do that. But that’s to be seen,”

U.S. Federal Reserve Chairman Jerome Powell

Powell’s statements came after a scheduled Federal Open Market Committee (FOMC) meeting on Jan 31. It triggered a significant pullback across risk assets, including stocks and the crypto markets.


Total Crypto Market Cap vs. Bitcoin (BTC) vs. Ethereum (ETH) Price Performance after Jerome Powell Statement, Jan. 30 - Feb. 1, 2024 | Source: TradingView
Total Crypto Market Cap vs. Bitcoin (BTC) vs. Ethereum (ETH) Price Performance after Jerome Powell Statement, Jan. 30 – Feb. 1, 2024 | Source: TradingView

Within 48 hours of Powell’s comments, Bitcoin (BTC) and Ethereum (ETH) prices dipped 5%, respectively, while the overall crypto market tumbled 4.3%, shrinking by over $90 billion between Jan. 30 and Feb. 2 as depicted in the chart above.  

However, on-chain signals suggest that Ethereum investors doubled down on their bullish positions in defiance of the market pullback. Also, the latest official non-farm payrolls report released on Feb. 2 could set the stage for a bullish recovery phase in the days ahead. 

Non-Farm Payrolls Report Nearly Doubles Market Expectation

On Feb. 2, the U.S. Bureau of Labor Statistics released the latest edition of its monthly non-farm payrolls report. Ahead of the latest figures, consensus data compiled by TradingEconomics shows that the market analysts had priced in a 180,000 increase in U.S. non-farm jobs. 

USA Non-Farm Payrolls Report, Feb 2, 2024 
USA Non-Farm Payrolls Report, Feb 2, 2024  | Source: TradingEconomics

The official figures released on Feb. 2 showed that U.S. non-farm establishments added 353,000 jobs in January 2024, 92.8% higher than market expectations. A closer look also shows this uptick of 20,000 jobs represents a fourth consecutive month-on-month increase dating back to October 2023.

How U.S. non-farm payrolls report impact crypto market

Strategic investors could interpret this better-than-expected jobs data as a potentially bullish indicator for risk assets, including stocks and cryptocurrencies. Increasing jobs typically signals an overheating economy, which often prompts consideration for rate cuts to cool the market.

This doubts Powell’s recent statement that the Fed could postpone rate cuts beyond the widely-predicted March 2024.

In essence, the latest U.S. non-farm payrolls report for January 2024 increases expectations of imminent rate cuts among investors. This could trigger more bullish trading activity across the crypto markets in the days ahead. 


Crypto Market Price Action after Non Farm Payrolls data, Feb 2, 2024
Crypto Market Price Action after Non-Farm Payrolls data, Feb 2, 2024. Source: TradingView

At press time on Feb. 2, the global crypto market capitalization is trending at $1.6 trillion, adding $3.6 billion daily. Since the non-farm payrolls report was published, Bitcoin price is back above $43,000 while Ethereum price has also reclaimed the $2,300 territory.

This tamed positive reaction could set the stage for a more bullish outlook in the days ahead. 



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