Bitcoin Surges Past $85,000 Ahead of US Jobs Report

Bitcoin surpassed $85,000 on October 2, a day before the US September employment report was released. The surge came amidst reports of short positions being closed and a weaker dollar, but traders and analysts are now wondering if fresh buyers will emerge after the report.

According to a trader, closing a short position is not the same as adding Bitcoin for months, and the distinction will matter after the jobs report. The Bureau of Labor Statistics is set to release the Employment Situation report at 8:30 a.m. Eastern, which will change the bond market's view of the Federal Reserve.

The market question is not whether the jobs number is good or bad, but rather who will take the other side when forced buyers have finished covering, and at what price. Various metrics, including ETF creations, exchange spot volume, futures open interest, and Treasury yields, will provide clues to this question.

There are two types of buyers: short sellers who close their positions and fresh spot buyers. While their actions can propel a price move, they reflect different market dynamics. Short sellers may close their positions voluntarily or have them liquidated by the venue, creating buying pressure in the relevant market.

A fresh spot buyer, on the other hand, lifts offers, resulting in a similar price chart at first. However, the distinction emerges in positioning afterward. If short futures are closed, open interest can fall while the price rises. If new longs arrive, open interest may hold or grow.