• Non Farm Payrolls: Forecast 60k, Actual -92k
• Unemployment Rate: Forecast 4.3%, Actual 4.4%

Coming into today's print, the market's focus has been on the conflict in the Middle East and the inflationary impact that's likely to have. As a result, Fed rate cuts have been pushed out by the market, due to the potential higher inflation that's set to come. And with recent resilient labour market prints, the market is discounting the labour market component when pricing future cuts - hence the focus has recently been elsewhere (on the conflict in the Middle East).

But, today's labour market comes in as a huge downside surprise with the Unemployment Rate ticking up and jobs showing a negative print.

What This Means?

This print was highly unexpected. Markets were positioned for continued robustness in the labour market, however, with the labour market now showing a huge downside surprise, this makes the Fed's job very difficult, as their dual mandates are in conflict:

• a labour market that is weakening,
• and inflation that's moving higher.

The Fed likely has to remain on hold to combat the higher inflation that's likely to come due to the conflict in the Middle East, and for now, this is just one bad labour market print. But should we see the next labour market print come in weak, the Fed will have to choose which side of their mandate they want to prioritise.

Ultimately, the Fed will likely remain on pause for the next 2 meetings, and allow more data to come out. Either way, this isn't supportive for risk assets, particularly in the near-term.

Market Reaction:

Going into the print, Crypto and the TradFi stock indexes were down slightly, whilst government bond yields rose.

Today's labour market print hasn't altered price action much as the market remains focused on issues elsewhere, rather than today's labour market print, as it is just one print. But the market realises that today's print puts the Fed in a tricky spot, but either way, they'll remain on hold for the foreseeable future, and markets will likely trade lower due to this.

Our View?

We expect Bitcoin to remain range-bound between $65k and $73k, however, should the price break out above $73k, then $76k-$80k would come into play - but, price has reacted relatively weakly following Wednesday's rejection into $74k.

Our Base Case: is for Bitcoin to remain range-bound in the immediate term. Whilst it's possible price can break out to $76k-$80k, we're not confident that the backdrop is there for us to warrant risking-on to play a move higher. For now, we remain patient as our base case is that Bitcoin will fill our high conviction support zone ($50k-$60k) in the coming months.

From a framework perspective, the $50k-$60k zone remains where our cost basis models and on-chain data suggest deep value historically. We are not active at current levels and continue to wait for the data to shift.

Cryptonary’s Take:

This labour market print complicates the picture for the Fed and the market. However, it's one print, so the market is unlikely to react hugely to it. Regardless, the Fed is likely to remain on pause with interest rates now unlikely to come down until at least late-Q3 as the inflationary impact of the conflict in the Middle East is likely to remain front-and-centre. This is an unsupportive backdrop for risk assets, and it's likely going to be a headwind for Bitcoin and Crypto in the near and medium term.

We remain of the view that Bitcoin and Crypto will stay range-bound in the immediate term (between $65k-$73k), although, a breakout to the upside is possible, it's not something we're looking to play now following the rejection at $74k, and price weakness since then.

Our base case is that prices will visit the $50k-$63k zone, which is a deep value area for price, and therefore that zone is where we’d expect the risk/reward to shift meaningfully in favour of long-term positioning.