Strong US Jobless Claims & Surging Trade Deficit Stir Markets

Bitcoin fell below $66,000 on Thursday following mixed US economic data. Initial jobless claims beat expectations, while the trade deficit widened sharply, fueling renewed risk-off sentiment in crypto markets.

Crypto markets in general were watching today’s data release, which featured among the economic data expected to influence Bitcoin sentiment this week.

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Bitcoin Retreats Below $66,000 Amid Mixed US Economic Signals

The Labor Department reported 206,000 initial jobless claims, down from a revised 229,000 the prior week and well below market expectations of 225,000.

The four-week moving average also edged lower to 219,000, signaling a labor market that remains resilient despite ongoing economic headwinds.

At the same time, continuing claims, which track ongoing unemployment, rose by 17,000 to 1.869 million, slightly above forecasts of 1.860 million.

This reflects a stable but softening labor market, with limited new hiring but no dramatic layoffs.

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While the labor data might have suggested stability, markets were rattled by the unexpected jump in the US trade deficit.

The Treasury Department reported that the trade gap surged to $70.3 billion in January, well above the $55.5 billion expected and the prior $53.0 billion print.

The widening deficit reflects growing external imbalances amid persistent domestic demand. This adds a layer of uncertainty for investors already witnessing complex macro conditions.

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Despite signs of cooling inflation, Truflation data shows prices remaining below 1% since early February. Crypto markets reacted negatively. Bitcoin’s retreat below $66,000 coincided with broader crypto sell momentum, as traders digested the juxtaposition of strong employment, weak trade balances, and low inflation.

This highlights how technical market sentiment can amplify reactions to economic surprises. The latest macro environment has triggered cautious positioning, with investors reducing exposure amid heightened uncertainty.

The divergence between labor market resilience and a blowout trade deficit illustrates the current macroeconomic tension.

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While the labor market data may temper fears of a sudden economic slowdown, the sharp increase in trade deficits could weigh on risk assets if it signals broader demand imbalances.

The interplay of strong employment figures, sub-1% inflation, and a widening trade gap is creating a delicate backdrop for both traditional and digital markets.

Traders will likely watch upcoming economic releases, particularly December PCE and core PCE, and the final Q4 GDP revision reports to gauge whether risk sentiment stabilizes or volatility intensifies further.