Bitcoin soared to 6.5 million yen this week, but be wary of price range adjustment risk | Contributed by bitbank analyst

Virtual currency market prices this week from 12/1 (Sat) to 12/7 (Fri)

Mr. Hasegawa, an analyst at Bitbank, a major domestic exchange, illustrates this week’s Bitcoin chart and deciphers the future outlook.

1. Bitcoin on-chain data
2. bitbank contribution

Bitcoin on-chain data

Number of BTC transactions

Number of BTC transactions (monthly)

Number of active addresses

Number of active addresses (monthly)

BTC mining pool remittance destination

Exchange/Other services

bitbank analyst analysis (contributed by Tomoya Hasegawa)

Weekly report from 12/1 (Sat) to 12/7 (Fri):

This week, Bitcoin (BTC) vs. yen succeeded in breaking above 5.61 million yen (38,000 USD level at the time), which had struggled to break out until last week, and at one point reached 6.5 million yen for the first time in 2 years and 1 month. The yen was restored. As of noon on the 8th, the market price had softened slightly and was hovering around 6.2 million yen.

On the 1st, US Federal Reserve Chairman Jerome Powell expressed a cautious stance on further interest rate hikes, and the BTC yen successfully rose to 5.61 million yen on the same day, maintaining a steady trend over the weekend. We aimed for the $40,000 level (approximately 5.76 million yen), where open interest is concentrated in the options market.

As a result, the price increased to around 6.2 million yen at the beginning of the week due to spot buying and short covering by options hedges.

On this day, BlackRock (BR) and Bitwise filed amendments to their respective Bitcoin exchange-traded funds (ETFs) with the U.S. Securities and Exchange Commission (SEC). Then, the next business day, Coinbase’s stock price (COIN) skyrocketed. In addition, the number of JOLTs job openings for October announced on the same day fell, causing US bond yields to fall and BTC to touch 6.5 million yen at one point.

On the other hand, as a result of this, the market stalled once it touched the $45,000 level. On the 6th, the ADP employment report showed a decline in the number of private sector employees, but the U.S. market was sluggish due to weakening U.S. stocks due to concerns about economic recession and concerns that the decline in U.S. bond yields was going too far. failed to chase the top price.

Then, on the 7th, the market weakened further due to the sudden drop in the dollar-yen exchange rate due to speculation that the Bank of Japan would correct its policy, and the flight of funds from BTC due to the alt-turn. By US time that day, the dollar/yen exchange rate had fallen further, with the market forecast to drop below 6.2 million yen.

Figure 1: BTC vs. Yen chart (1 hour timeframe) Source: Created from bitbank.cc

The dollar-denominated BTC market has maintained most of its gains since the beginning of the week, but the yen-denominated market has weakened due to the impact of exchange rates.

JOLTs job openings and the ADP employment report indicate a slowdown in the U.S. labor market, suggesting that the Federal Reserve will halt interest rate hikes or cut rates early. However, U.S. Treasury yields have fallen rapidly recently, and the market is There are some voices of concern that the price has fallen too low.

Under these circumstances, the November US employment statistics to be released on the 8th predict that the monthly increase in non-agricultural employment will improve from 150,000 in October to 180,000.

In addition to the feeling that US bond yields have fallen too low, there is also speculation that if the results of the employment statistics are as expected by the market, there is no need for the Fed to rush to cut interest rates, so there is a possibility that yields will rebound sharply due to the reaction, and the BTC market We need to be wary of downward pressure on the market.

Recent US economic indicators confirm a slowdown in the labor market and a slowdown in inflation, which can be said to be positive for BTC, but it has been pointed out that the market is pricing in an excessively early and rapid rate cut, leading to a reversal. If this happens, it is likely to be a strong headwind for risk assets, including BTC.

In addition, BTC’s daily relative strength index has exceeded 70%, which is considered “overbought,” and even if the US employment statistics are favorable to the market, there is a risk of profit-taking after the rally stops due to overheating. In any case, the current upward trend in market prices will not continue for long.

In addition, with the rise in BTC prices over the weekend, a window has opened between $39,500 and $40,500 for BTC futures on the Chicago Mercantile Exchange (CME), and the possibility of a price range adjustment is low. It can be said that vigilance is still required.

Contributor: Tomoya HasegawaTomoya Hasegawa (Yuya Hasegawa)

After graduating from a British graduate school, he worked as an analyst for the FinTech industry and virtual currency market at a venture company made up of people from financial institutions. Since 2019, he has been a market analyst at BitBank Co., Ltd. He has provided comments to major domestic financial media and has contributed to many overseas media.

connection:bitbank_markets official website

Previous report:If the US economy continues to slow down, is it only a matter of time before Bitcoin breaks out?

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