What Changes Will Strong Non-Farm Data Bring?

   The non-farm data for the U.S. in September was outstanding, and surprisingly good. Not only did the number of new jobs exceed market expectations, but the unemployment rate also unexpectedly fell, and wage growth increased, paired with steadily declining CPI data, rather than a "soft landing." Let's continue to soar.

Main Impacts

1. The non-farm employment in the U.S. for September significantly improved, with notable expansion in service sector employment.

2. The unemployment rate fell more than expected, with a significant decrease in the number of temporary workers among the unemployed. The number of new entrants and re-entrants to the job market also decreased, and the labor participation rate remained stable for several months, reflecting a moderate improvement in labor supply.

3. Additionally, the job vacancy rate and employment rate increased, while the pace of closing the supply-demand gap slowed marginally. The turnover and layoff rates declined, indicating that the job market is still gradually cooling.

4. Most sectors in the service industry saw a month-on-month decline in hourly wages, indicating that core service inflation pressures remain stable and controllable.

Summary

   The improvement in the unemployment rate in September and the high increase in new jobs overall indicate that the U.S. job market remains healthy. Following the data release, market expectations for a Federal Reserve interest rate cut were significantly revised downwards, with the 10-year U.S. Treasury yield and the dollar index rising sharply, and U.S. stocks opening higher collectively.

  Looking ahead, as the trend of stable and declining inflation remains unchanged, the Federal Reserve's focus will be on the job market's performance. Before the interest rate meeting in November this year, there will still be October employment data for the Fed to observe. However, the October data may be disturbed by short-term events such as Hurricane Helen and strikes at ports and Boeing, making the September data potentially more valuable for reference. Combined with the October data, it overall points to a gradual cooling of the U.S. job market.

   Therefore, the pace of interest rate cuts by the Federal Reserve this year may be more moderate, with the cumulative rate cut likely not exceeding 100 basis points. This means that due to the strong non-farm data, the Fed will slow down the pace of rate cuts; it will not accelerate the rate cut rhythm as previously expected, and the next significant rate cut is likely to be only 25 basis points.

                     Specific Trends of Bitcoin

(1) From a weekly perspective, there have been three consecutive weeks of upward movement. This week shows a long lower shadow with a bearish candle. Additionally, the MACD indicates signs of convergence, with volatility gradually diminishing. This pattern may intensify the subsequent oscillation rhythm, but the current trend still shows a bullish advantage, as there has been no appearance of a bearish candle with a lower body. Therefore, even if there is oscillation, it is still a correction within the bullish trend.

(2) From the daily pattern this week, there were two large bearish candles followed by a doji. After the doji formed on Wednesday, the market reversed, halting the consecutive downward trend. Prices fluctuated around the MA average, and by Friday, there was a surge towards the resistance level around 62800. Even in the face of unfavorable non-farm data, there was a quick rebound, eventually breaking through the 50% level, and over the weekend, it maintained above 61500. Thus, the strength of the pullback did not damage the bullish momentum for further rebounds.

(3) From this week's operational rhythm, there have been several days of doji patterns, with high repetition on the upper line, but none have broken below 60000. The daily trend has generally been a downward pattern, mostly showing early morning highs followed by declines, with the European session continuing the downward trend, but the extent of the declines has been limited. The U.S. session saw a bottoming rebound, indicating that the overall operational rhythm is running between the upper resistance at 62800 and the lower support at 60000. Additionally, the weekend ended with doji candles, so there is a high probability of continued range-bound movement next week.

Next Week's Strategy:

   Based on the non-farm data, it has not disrupted Bitcoin's trend. From the price movement rhythm across different cycles, it has only increased the demand for subsequent oscillations, but the overall pattern still favors the bulls. Therefore, next week, we will continue to look for an upward oscillation pattern. Additionally, the time and pattern cycles have not been disrupted, so at the beginning of next week, we will continue to monitor this cyclical movement for operational responses, with lower support at 61500/60000 and upper resistance at 62800/64400. On Monday, we will prioritize observing the breakout situation in the 61500-62800 range.

In summary:

   The impressive performance of the non-farm data is just a single data point; the economy is interconnected. Without more supporting economic data, even the strongest numbers could be fleeting. In terms of technical patterns, the previous continuous upward movement and recent corrections are also a way for bulls to accumulate energy. Although short-term oscillations are within a parallel range, based on the principle of following the trend, we expect an upward oscillation next week. However, it is worth emphasizing that we still do not believe there will be a change in the long-term upward pattern; the extension of the adjustment cycle does not hinder the subsequent upward momentum.

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