Strong US jobs data was released today at 14:30 CET, showing 256K new jobs versus the expected 164K, while the unemployment rate fell to 4.1%. This stronger-than-expected data could lead to more risk-off sentiment, as 97% of speculators now believe the Fed will hold rates steady at its next meeting. As a result, with stocks pulling back and the USD strengthening, even cryptocurrencies could face more weakness.
Remember, Powell delivered a hawkish cut back in December, when they noted that there can be less cuts in 2025 due to strong economic projections for 2025 which can bring infaltion back up so they must be carefull with rate decision. And this data today is reason why FED may stay on old, rahter than cut and why then stocks can resume even low, which have been in corrective territory since the last Fed meeting in December.The key focus now is identifying the next major support level for stocks. I believe that once stocks turn back to the upside, it could open opportunities across other assets, including cryptocurrencies.
Looking at the S&P 500 futures contract, there has been a slow but steady recovery since early November, following Trump’s win in the US elections. However, the market may attempt to liquidate latecomers who joined the stock rally after Trump’s victory. The 5,800 level on the SP500 futures stands out as a critical support zone, acting as a “stop-loss” level for many positioned in the well-known “Trump trade.” If the price reaches this area, more liquidations could occur, potentially clearing the way for a stronger bounce. Markets rarely move straight up that will profit everyone; liquidations often happen on the way higher. There is no easy money.
From an Elliott Wave perspective, the sharp drop from all-time highs looks like an incomplete correction. The current sideways movement likely forms wave B, suggesting that wave C could lead to more liquidations toward the 5,800 level, which I see as a very important support zone.If this is indeed is a triangle in wave B, keep in mind that moves out of triangles are final in the sequence, meaning any drop could be limited before the market turns higher. So, I still believe risk-on sentiment will return, but this may not happen until Trump officially returns to office and market positioning settles for 2025. Regarding Bitcoin, I see the 85,000–87,000 area as a very interesting support zone, where more downside could be limited.
Grega
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