War Bloodbaths Crypto Market. Bitcoin Loses 73,000 Again, Market Awaits Non-Farm Data to Crash or Save Market

TradingKey - Renewed clashes between the US and Iran hit the crypto market hard; Bitcoin fell below $73,000, and this Friday's non-farm payroll data becomes critical.

On June 1, conflict in the Middle East caused the already weak crypto market to soften further, falling 1.2% intraday as total market capitalization dropped to $2.47 trillion. Meanwhile, Bitcoin ( BTC) fell more than 1%, briefly losing the $73,000 level; Ethereum ( ETH) dropped nearly 2%, breaking below the $2,000 mark; Solana ( SOL ), Ripple ( XRP ), and TRON ( TRX) all fell by around 2%, while Binance Coin ( BNB) plunged more than 5%.

Weekend clashes between the US and Iran have once again dampened bullish sentiment in the market. According to U.S. Central Command, U.S. forces struck Iranian radar and drone command and control sites over the weekend. Iran's Islamic Revolutionary Guard Corps (IRGC) also confirmed on June 1 that U.S. forces attacked a communications tower on Sirik Island in Iran's Hormozgan Province, and the IRGC subsequently struck the U.S. airbase from which the attack originated.

This round of declines triggered liquidations for over 100,000 traders across the network, totaling as much as $247 million. Unlike in the past, long liquidations this time were primarily concentrated in Bitcoin and Ethereum, while other altcoins saw more short positions liquidated. This phenomenon occurred because a small number of altcoins (such as HYPE, WLD, and XLM) have recently shown strength, moving independently of the broader market.

Crypto market liquidation data, Source: CoinGlass

Despite the strong performance of some altcoins, the overall crypto market remains weak and in a state of panic, with a sentiment index of 34 (below 50 indicates fear). Under these adverse conditions, investors have begun looking for a "lifeline," turning their attention to upcoming U.S. economic data and events this week, including April JOLTS job openings, May ADP employment figures, the May Non-Farm Payrolls (NFP) report, and the Federal Reserve's Beige Book. Among these, the NFP is the most closely watched, as this data will directly determine the Fed's future interest rate policy path.

If non-farm payrolls come in below expectations and the unemployment rate rises slightly, it would signal that the U.S. labor market is cooling. This would significantly ease inflation concerns and revive market expectations for Fed rate cuts. In that scenario, the US Dollar Index and Treasury yields would likely retreat, global liquidity would flow back into risk assets, and Bitcoin could be propelled to rebound past $75,000.

However, if the non-farm data is unexpectedly strong, it will further diminish the likelihood of Fed rate cuts and could even reignite fears of rate hikes. In such a case, Bitcoin would likely fall below $70,000, with a potential slide toward $60,000 not ruled out. It is important to note that the most critical level now is $75,000, which served as a support level during the late-April rebound but has now turned into resistance. Failing to reclaim this level would mean that the Q3 market will continue to be dominated by bears.

Bitcoin price chart, Source: TradingView