This round of non-farm payrolls report is really a bit of a dead end. The addition of 119,000 jobs exceeded expectations, and at first glance, the situation looks quite positive. However, the unemployment rate suddenly surged to 4.44%—the highest since 2021. The crypto market is caught in the middle, feeling a bit confused.

Let's first look at the nuances of the employment data. The 119,000 new jobs seem good, but a closer look reveals some clues: most of the growth comes from industries with dense part-time employment like education, healthcare, leisure, and hospitality, and the figures from previous months have been significantly revised downward. In other words, employment growth is slowing, and the true resilience of the job market remains to be seen.

What’s more heartbreaking is the unemployment rate. The number of involuntary unemployed has risen sharply, approaching the psychological threshold of 4.5%. For the Federal Reserve, this hits a sore spot—they fear a softening labor market the most. The December rate cut decision saw three dissenting votes, and internal Fed divisions are heating up. Doves want aggressive rate cuts, while hawks prefer to hold steady. Expectations of a pause in rate hikes during Powell’s term are growing stronger.

How does this affect BTC? Such policy uncertainty is the root cause of "weak volatility." On one hand, strong non-farm data suppresses rate cut expectations, giving the dollar short-term support, which is not very friendly to crypto assets. On the other hand, the rising unemployment rate leaves room for liquidity easing, plus the implicit support from the Fed stopping balance sheet reduction, giving BTC reasons to rebound. The result is a tug-of-war around the key support level of 85,000.

From a technical perspective, risks are significant. BTC’s daily RSI has already fallen below 50. If 85,000 support is lost, the next target is directly at 82,000. Conversely, if a breakout above 88,000 occurs on the back of easing expectations, short-term downward pressure can be alleviated. But caution is needed regarding the dual shocks from the Bank of Japan’s rate hike expectations and the withdrawal of arbitrage funds, as these factors can amplify volatility.

This data game is far from over. The Fed’s policy moves in January are a key variable. What do you think? Will BTC hold steady at 85,000 and then rebound, or will it break below to test 82,000? Will the Fed really pause rate hikes in January?