Bitcoin moved closer to breaking below $65,000 on Thursday after stronger-than-expected US labor market data pressured risk assets.
Initial jobless claims came in far below market forecasts. As a result, investors became more concerned that the Federal Reserve could keep interest rates elevated for longer.
Bitcoin Price Approaches the $65,000 Support Level
Bitcoin dropped to an intraday low of $65,059.59, placing the cryptocurrency just above the important $65,000 support level.
At the time of reporting on July 23, BTC traded at approximately $65,108.24. The price was down 1.02% over the previous 24 hours.
Bitcoin’s hourly chart had already shown signs of weakness before the US employment report was released. However, selling pressure increased after the stronger labor market figures became public.
Several long red candles pushed BTC below the $65,400 support zone. Buyers attempted to trigger a recovery near $65,060, but the rebound remained limited.
This price action suggests that sellers continue to control the short-term trend.
If Bitcoin falls decisively below $65,000, the market could experience another downward move. On the other hand, BTC would need to recover the $65,400 to $65,500 area to show early signs of renewed strength.
US Initial Jobless Claims Fall Below Expectations
The latest Bitcoin decline followed the release of new US initial jobless claims data.
According to the US Department of Labor, initial claims for the week ending July 18 fell to 187,000. This figure was significantly below Wall Street’s forecast of 212,000 claims.
Claims also declined by 22,000 compared with the previous week’s revised total of 209,000.
Meanwhile, the four-week moving average fell to 207,500.
The data indicates that the US labor market remains resilient despite the continued impact of elevated borrowing costs.
Could Strong Jobs Data Affect the Federal Reserve?
A strong labor market may reduce pressure on the Federal Reserve to ease monetary policy.
When employment conditions remain stable, policymakers have more flexibility to keep interest rates high. They may also consider additional tightening if inflationary pressures continue.
Higher interest rates often create difficulties for risk assets. Investors may move money away from cryptocurrencies and other volatile investments toward safer assets that offer attractive returns.
Therefore, stronger employment data can place additional pressure on Bitcoin and the broader crypto market.
Traders Focus on the July FOMC Meeting
Investor attention is now shifting toward the Federal Open Market Committee meeting scheduled for July 28 and 29.
According to the reported CME FedWatch Tool figures, markets were pricing in a 62.1% chance that the Federal Reserve would maintain its benchmark interest rate between 3.50% and 3.75%.
The market also reportedly assigned a 37.9% probability to a 0.25% rate increase following the latest employment data.
However, these probabilities can change as investors receive new economic information before the meeting.
Will Bitcoin Fall Below $65,000?
Bitcoin is currently trading near an important technical level.
The $65,000 support zone will likely remain the main focus for traders ahead of the Federal Reserve meeting. A clear breakdown below this level could strengthen bearish momentum and trigger additional selling.
In contrast, a recovery above $65,400 and $65,500 could help Bitcoin stabilize in the short term.
The Federal Reserve’s policy statement will also be important. A more hawkish message could create further pressure on BTC, while a softer stance may support a market recovery.
