Bitcoin Price Set to Rebound Ahead of US Government Shutdown, NFP Data

Bitcoin price rose for two consecutive days as it moved from a low of $108,650 to nearly $114,000. BTC has formed a double-bottom pattern, pointing to more upside, ahead of the potential US government shutdown and the non-farm payrolls (NFP) data.

Bitcoin Price Forms Double-Bottom Pattern

The daily timeframe chart shows that the BTC price bottomed at $108,650 last week as crypto liquidations jumped.

A double-bottom pattern is made up of two lows swings and a neckline, which, in this case, is at $117,875.

The price target in a double-bottom pattern is estimated by first measuring the distance between the upper side and the neckline, and then the same distance from the neckline. 

In this case, measuring the same distance from the neckline brings the target to about $127,000. The jump to that target will point to more gains, potentially to the year-to-date high of $124,200.

Bitcoin price has moved above the 50-day and 100-day Exponential Moving Averages. Also, the Relative Strength Index (RSI) and the MACD indicators have pointed upwards.

Therefore, the most likely Bitcoin price forecast is bullish. However, a drop below the double-bottom point at $108,650 will invalidate the bullish Bitcoin price forecast.

US Government Shutdown and NFP Data Ahead 

The next important catalyst for the Bitcoin price will be the potential US government shutdown as differences between Democrats and Republicans continue.

Republicans have advocated for a clean spending bill, while Democrats want to use their leverage to implement some policies on health and Medicaid.

With the differences between the two sides being wide, there is a likelihood that the government will shut down when the funding runs out.

A shutdown would benefit Bitcoin price because it would likely have an impact on the economy, as the government is one of the top spenders in the US. As such, it would raise the possibility that the Federal Reserve will continue cutting interest rates in the next meeting as recession risks remain.

In a recent statement, Mark Zandi noted that while recession risks have receded in the past few days, they remained uncomfortably high. He cited the fact that the ongoing economic growth was being driven by AI spending and by the wealthy, who have benefited from the ongoing asset valuation surge.

Looking ahead, the BTC price will react to the upcoming US non-farm payrolls (NFP) data expected on Friday this week. This report will provide more information about the health of the American labor market and help to predict when the Fed will cut interest rates.

Some Fed officials, like Beth Hammack, have warned that the labor market is still strong and inflation is too high and are urging the bank to be careful when cutting interest rates. She believes that rate cuts will be inflationary.

Bitcoin price may also do well as it mirrors the performance of gold, which has jumped to a record high this year amid strong demand from institutions.