3 Key Factors That Could Influence Crypto Markets This Week
The first full trading week of the year is set to bring significant economic updates in the United States, potentially impacting crypto markets as investors return to “work mode.”
Following a modest ‘Santa rally’ in early January, digital asset markets saw inflows of approximately $280 billion, maintaining gains from the previous week. With positive momentum building, traders are eyeing upcoming economic data that could shape trends in the days ahead.
This week’s focus will be on employment reports and consumer sentiment indicators, providing insights into the economy’s health and influencing risk appetite in both traditional and crypto markets.
Key Economic Events: January 6–10
A series of economic reports are scheduled this week, offering important data points that may drive market sentiment.
Monday kicks off with the S&P Global Services PMI (Purchasing Managers’ Index), providing insights into business activity within the services sector. Tuesday follows with the ISM Services PMI report, another indicator closely monitored by analysts to assess economic strength.
Labor market data will take center stage midweek, starting with the JOLTS Job Openings report for November on Tuesday. This data reflects the number of job openings, offering a snapshot of employment trends and economic stability.
On Wednesday, the ADP Nonfarm Employment Change report will deliver insights into private-sector job growth for December, setting the tone for the broader employment outlook.
Friday’s Nonfarm Payrolls and Unemployment Reports are among the most anticipated releases. These reports will highlight the number of jobs added in December and the unemployment rate, key indicators of economic health and labor market conditions.
Why These Reports Matter for Crypto Markets
Labor market data and economic sentiment reports are closely tied to Federal Reserve policy decisions, particularly with the upcoming January 29 Fed meeting.
Strong employment numbers could suggest economic resilience, reducing expectations of rate cuts, which may weigh on speculative assets like cryptocurrencies. Conversely, weaker data may fuel speculation of monetary easing, potentially boosting risk assets, including Bitcoin and altcoins.
Key Events This Week:
— The Kobeissi Letter (@KobeissiLetter) January 5, 2025
1. S&P Global Services PMI data – Monday
2. November JOLTS Job Openings – Tuesday
3. December ADP Nonfarm Employment data – Wednesday
4. Fed Meeting Minutes – Wednesday
5. December Jobs Report – Friday
6. Total of 8 Fed Speaker Events
Get ready for a…
Key Economic Events and Crypto Market Outlook for the Week
This week, economic data releases and global market developments are expected to shape crypto market trends. With the Q4 2024 earnings season set to kick off in mid-January, investors are closely monitoring financial and macroeconomic indicators for insights into the broader economic outlook.
On Friday, the Michigan Consumer Sentiment Index and Consumer Inflation Expectations preliminary readings will be released. These reports gauge consumer confidence and inflation expectations, offering valuable insights into long-term economic sentiment in the U.S.
Economic Concerns and Global Volatility
In addition to domestic economic data, global markets remain on edge due to growing concerns about China’s real estate crisis. The Kobeissi Letter warned that the impact of China’s property sector collapse could extend far beyond real estate, potentially triggering global volatility as markets head deeper into 2025.
With these factors in play, analysts are bracing for increased volatility across both traditional and crypto markets in the coming weeks.
Crypto Market Overview
The total cryptocurrency market capitalization remained steady over the past 24 hours, holding at approximately $3.68 trillion at the time of writing.
Bitcoin continues to show bullish momentum, hitting a ten-day high of $99,000 during early Asian trading on Monday morning. The leading digital asset has posted gains of 7.5% over the past week, edging closer to reclaiming the psychological $100,000 mark.
Market analysts suggest that sustained bullish sentiment, coupled with economic uncertainty, could push Bitcoin above this critical level in the near term.
#BTC
— Rekt Capital (@rektcapital) January 5, 2025
Post-breakout Quarterly Retest and Trend Continuation confirmed$BTC #Crypto #Bitcoin https://t.co/T5fYyyybjH pic.twitter.com/geXSv4SYue
Ethereum has mirrored the action with a similar weekly gain as it tapped $3,670 on Jan. 6, its highest price since Dec. 19.
Most of the altcoins were flat on the day, having held on to weekend gains, and momentum appears set to continue this week.
