Benjamin Cowen discusses the latest labor market report, noting that the unemployment rate has now risen to 4.6%. He suggests that this rising rate may serve as the current market's narrative to justify a Bitcoin top, similar to how rising inflation justified the top in 2021.
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Macro Headwinds: The unemployment rate has been trending steadily higher since June, signaling a weakening labor market due to a drop in job openings and hiring. This weakness ultimately justifies the need for lower interest rates and money printing, which are the only tools the Federal Reserve knows.
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Fed Easing Status: Despite recent rate cuts, the Fed is not yet in a true easing stance because the Fed Funds Rate (3.75%) is still above the 2-year Treasury yield (3.5%). The Fed typically needs to chase the 2-year yield lower before a massive run in Bitcoin begins.
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Short-Term Price Path: Cowen expects sustained macro headwinds for Bitcoin into early 2026. He forecasts a local low in late December/early January, followed by a bounce up to the 200-day or 50-week moving average. However, this bounce will likely result in a macro lower high before more weakness.
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Preferred Pattern: Due to the top being driven by apathy rather than euphoria, he believes the price action is more likely to mirror 2019, involving a sweep of the prior low before a counter-trend rally occurs.
The Takeaway
Cowen believes the true macro tailwinds for Bitcoin will not arrive until mid to late 2026, which is when Jerome Powell is likely to be replaced, allowing the new Fed Chair to aggressively cut rates to tackle the rising unemployment rate. Ultimately, he concludes that regardless of the macro narrative, Bitcoin is simply following its historical pattern of topping out in Q4 of the post-halving year (2013, 2017, 2021, 2025).
