Bitcoin and Litecoin Pressured by the Strong US Jobs Data

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Bitcoin and Litecoin Pressured by the Strong US Jobs Data

The Non-Farm Payroll data on Friday gave the USD strength across the board, even against the cryptocurrencies, bitcoin (BTCUSD) and litecoin (LTCUSD). Both are now continuing their prevailing downtrends. The NFP report showed 248K jobs added in September, which beat forecasts around a 216K reading. The August reading was revised up to 180K from a 142K initial print. Unemployment rate fell to 5.9% from 6.1%. The strong jobs data gave the USD a boost because it fuels the current speculation that the FOMC will raise rates at latest in mid-2015, and possibly earlier.

Bitcoin (BTUCSD) 4H Chart 10/3
bitcoin 4h chart 10/4

(click to enlarge)

Extending a Downtrend:
Before the NFP, bitcoin was already in a downtrend as we can see in the 4H chart. Een though the momentum may have been choppy in the past 2 weeks, we do see lower highs and lower lows while price remained below the 200-, 100-, and 50-period simple moving averages. The SMAs are sloping down and in bearish alignment. After a brief consolidation from a mini price bottom last week, price continued the downtrend, and extended after the NFP report. Right under the current price, bitcoin will be testing the 2014-low at 340, made in April, with a possible extension toward 300 considering the fact that price action has been bearish throughout 2014, and a new low on the year is thus very possible.

Litecoin (LTCUSD) 4H Chart 10/4
litcoin 4h chart 10/4

(click to enlarge)

Reviving a Downtrend:
Litecoin has also been bearish in 2014. It may have been more choppy than bitcoin in the past couple of week’s when price essentially consolidated between 3.90 and 4.90. Even before the NFP, ltcusd retreated, but it was after the jobs data that litecoin fell to 4.00, and it took until Saturday for price to fall below that September low of 3.90. Below 3.90, the prevailing downtrend is revived for ltcusd, and the next support levels are 1) 3.33, August low, and 2) 2.21, the 2014-low. After this week’s price action, if will take a rally above 4.30to challenge the downtrend – this would probably break above the 100- and 50-period SMA as well as a falling trendline from mid-September. Otherwise, 3.33 and 2.21, here comes litecoin.

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