Bitcoin (BTC) Dips on Weak US Jobs Data & AI Bubble Fears: More Pain Ahead?

Bitcoin Bulls Struggle as Selling Pressure Persists

The Bitcoin bulls just can’t seem to staunch the relentless tide of selling. Each new push to the upside appears weaker than the last, indicating diminishing momentum. Adding to the bearish market sentiment are weak jobs data and growing concerns that AI companies have become overbought. This combination raises an important question: can Bitcoin suffer yet another price dip?

Jobs Are Falling as AI Might Also Be About to Dip

October witnessed the worst unemployment figures in the last twenty years, with 153,000 layoffs reported. According to a report by Challenger, Gray & Christmas, more than 1 million job losses have occurred since the start of 2025. The primary drivers behind this sharp increase in unemployment are government cost-cutting measures related to DOGE and the growing impact of artificial intelligence (AI).

AI has enabled companies to restructure and automate many processes, resulting in significant workforce reductions. However, there are growing concerns that AI stocks have become vastly overbought, sparking fears of a bubble that could burst with wide-ranging consequences for both the US and global economies.

Investor Sentiment and the AI Bubble

Big Short investor Michael Burry has recently made headlines by publicly betting against tech giants Nvidia and Palantir. The legendary investor appears convinced that AI is currently in a bubble and is shorting these stocks accordingly, signaling caution to the market.

Is the S&P 500 Ripe for a Big Pullback?

Following a recent plunge, the S&P 500 index has more than recovered. However, as shown in the accompanying chart, the price has reached the top of a key blue channel and may be poised to start falling from this level. The bottom of this channel represents a realistic target, though speculation remains over whether political factors—such as potential intervention from former President Trump—might influence the extent of any decline.

Currently, the index price is holding below a descending trendline and seems to be heading back toward a previous low. The Relative Strength Index (RSI) at the bottom of the chart indicates the price is about to enter the oversold area once again. This suggests that the next price bounce has a higher probability of breaking through the descending trendline. Notably, this would constitute only the third retest of this crucial trendline.

If the retest does not happen immediately, it is likely to occur shortly thereafter. Supporting this view, the Stochastic RSI indicators at the bottom of the chart are crossing back up. Even if this doesn’t hold at the end of the week, the indicators remain near the bottom, making another upward crossover next week likely.

Interestingly, the next significant price support level below is the top of the last Bitcoin bull market at $69,000. During the 2022 bear market, the price retraced to retest this important level—raising the possibility that a similar scenario could unfold again.

Signs of a Possible Bull Market Continuation

There are also signs favoring a continuation of the bull market. The 2-week Stochastic RSI indicators are currently declining but could bottom and cross back up within the next month. Weekly indicators are nearly at their lowest levels, which does not point to an imminent bear market.

All eyes will remain on how Bitcoin’s price reacts to this major trendline in the near term.

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Disclaimer: This article is provided for informational purposes only. It is not intended to be used as legal, tax, investment, financial, or other advice.
https://bitcoinethereumnews.com/bitcoin/bitcoin-btc-dips-on-weak-us-jobs-data-ai-bubble-fears-more-pain-ahead/

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