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Technical Analysis

Gold Analysis – April 13, 2021

Descending Triangle Breakout, Bearish Bias Dominates!

Gold prices were closed at 1732.05 after placing a high of 1745.30 and a low of 1727.15. Gold continued its bearish trend for the third consecutive session and posted losses on Monday amid the rising U.S. Treasury yields that decreased the bullion’s appeal. Meanwhile, investors were waiting for the essential U.S. inflation and retail sales data to measure the economy’s health.

Gold prices remained stuck under the key $1750 level despite the sluggish U.S. dollar. The U.S. 10-year Treasury note’s benchmark yield reached 1.685% on Monday and added weight on the metal prices as they do not produce any yield or dividend. The Treasury yields were rising due to an excellent three-year and 10-year note auction and the awaited key data about the retail sales and inflation. CPI is scheduled to release on Tuesday and Retail Sales on Thursday, and the markets were under consolidation ahead of these data releases.

Higher yields threaten the appeal for gold as an inflation hedge due to the increased opportunity cost of holding gold which pays no interest. On Sunday, the Chairman of Federal Reserve, Jerome Powell, said that he was optimistic about the U.S. economy bouncing back due to successful coronavirus vaccine campaigns; however, he was also worried about the possibility of another surge in the infection cases. Powell was worried that a hasty reopening of economies could trigger a spike in coronavirus cases.

Powell said that the U.S. economy was at a turning point because of the successful government support and speedy vaccine campaigns. He forecasted that the U.S. economic growth would be robust in the second half of this year. Powell said that the U.S. economy was at an inflection point where the growth and job creation were poised to accelerate. These comments from Powell gave strength to the U.S. dollar that ended up having a negative impression on gold prices.

On the data front, at 23:00 GMT, the Federal Budget Balance showed a deficit of -659.6B against the expected -665.5B and weighed on the U.S. dollar that capped further losses in gold prices. The U.S. Dollar Index that measures the greenback’s value against the six major currencies’ basket reached 92.33 level and weighed on the yellow metal prices on Monday. Meanwhile, over the weekend, the South China Sea’s military activity spiked as a Chinese aircraft carrier entered the region and a U.S. Navy expeditionary strike group wrapped up exercises.

Gold Intraday Technical Level
1724.36 1742.51
1716.68 1752.98
1706.21 1760.66
Pivot Point: 1734.83

Gold – XAU/USD – Technical Outlook

On the technical side, the precious metal gold is trading with a bearish bias at 1,727 level, facing immediate resistance at 1,731 level. On the 2-hour chart, the XAU/USD has closed a bearish engulfing candle that’s supporting solid bearish bias in gold. On Tuesday, the trader’s focus is likely to stay on the U.S. CPI and Core CPI figures that are scheduled to come out during the New York session today. On the lower side, the precious metal gold is likely to find support around 1,721 level, and the violation of this level can extend gold price towards 1,706 level. The leading and lagging indicators are staying in a bearish zone. Stochastic has entered the oversold area, and typically such scenarios drive a bullish correction. Gold may face resistance around 1,731 and 1,745 areas today. Further price action can be seen on the release of the U.S. inflation figures. All the best!

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Technical Analysis

EUR/USD Analysis – April 13, 2021

Upward Channel Breakout

The EUR/USD pair was closed at 1.1909 after placing a high of 1.1920 and a low of 1.1870. EUR/USD pair rose on Monday and posted gains despite the rising U.S. treasury yields. The U.S. dollar weakened across the board on Monday as the U.S. Dollar Index fell for the day and provided strength to the rising EUR/USD pair.

At the beginning of this week, the single currency Euro faded the initially offered bias and regained composure that lifted the EUR/USD pair back above the 1.1900 marks. The currency pair reversed Friday’s downtick and retook the position near the 1.1900 neighborhood on the back of renewed selling pressure surrounding the U.S. dollar.

The U.S. Dollar Index that gauges the value of the greenback against the basket of six major currencies fell to 92.01 level on Monday and weighed on the greenback that ultimately pushed the currency pair EUR/USD higher. However, the declining U.S. dollar prices were little supported by the rising U.S. treasury yields amid a good 3-year and 10-year bond auction. The benchmark U.S. Treasury yield on a 10-year note reached 1.685% level and supported greenback that faded some of its losses for the day and found support near 1.92 level.

On the data front, at 14:00 GMT, the Retail Sales data from the whole bloc raised in February to 3.0% against the forecasted 1.3% and supported Euro that added further gains in EUR/USD pair. From the U.S. side, at 23:00 GMT, the Federal Budget Balance showed a deficit of -659.6B against the estimated-665.5B and weighed on the U.S. dollar and pushed further the prices of EUR/USD pair in the upward direction. On Monday, the Federal Reserve Chairman, Jerome Powell, said that he was optimistic about the U.S. economy bouncing back amid effective coronavirus vaccine campaigns. However, he was also concerned about the possibility of another rush in the infection cases. Powell was anxious that a speedy reopening of economies could cause a spike in coronavirus cases.

Powell also said that the successful government support and speedy vaccine campaigns had brought the U.S. economy to a turning point. He predicted robust U.S. economic growth in the second half of this year. Powell also said that the U.S. economy was at an inflection point and that the growth and job creation were poised to accelerate. The comments from Powell were not that surprising and failed to support the U.S. dollar that was weak throughout the day, and hence, the EUR/USD pair kept on moving in the upward momentum.

On the other hand, Europe surpassed the grim milestone of 1-million coronavirus deaths on Monday as the WHO warned that infections were rising exponentially despite widespread efforts to control the virus. Despite this news, the sing currency remained strong against the weak U.S. dollar, and the currency pair EUR/USD continued rising at the starting day of the week.

EURUSD Intraday Technical Levels
Support Resistance
1.1880 1.1930
1.1850 1.1950
1.1830 1.1970
Pivot Point: 1.1900

EUR/USD – Technical Outlook

The EUR/USD is trading slightly bullish at 1.1903 level, facing immediate resistance at 1.1916 level. Recalling our April 12 EUR/USD analysis report, the EUR/USD was trading within an upward channel extending support around the 1.1903 level; well, that channel has now been violated. The closing of candles outside this channel is supporting a bearish trend in the EUR/USD pair. On the downside, the EUR/USD pair is likely to find support at 1.1874, and the breakout of this level can open up the further bearish room until the 1.1830 level. On the flip side, the EUR/USD may find resistance at 1.1916 and 1.1946 levels. On Tuesday, the EUR/USD’s most of the price action will highly depend upon the release of series of high-impact news events such as the U.S. Inflation figures and the European German ZEW Economic Sentiment. Typically such events drive sharp movement and trading opportunities to the investors, so let’s keep an eye on these events today. All the best!

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Technical Analysis

BTC/USD Analysis – April 13, 2021

BTC Extends Symmetrical Triangle

The BTC/USD was closed at 59900 after placing a high of 60701 and a low of 59747. After rising for four consecutive sessions, the BTC/USD prices declined at the starting day of the week despite breaking above the $60,000 resistance level.

The decline in Bitcoin prices might have come through the CEO’s warning of a top Bitcoin exchange. Jesse Powell said that governments worldwide might start to clamp down on the use of Bitcoin and other cryptocurrencies. It came in after several officials, including U.S. Treasury Secretary and European Central Bank President, have been issuing a warning about the use of Bitcoin for money laundering, terrorist financing, and other illegal activities.

The Central Bank of Sri Lanka issued a general warning about the investment in cryptocurrency as it has a high level of risk involved. The CBSL said that investing in digital assets like Bitcoin, Ethereum and Litecoin comes with an even higher risk. The means of obtaining cryptocurrencies include exchanges, mining, or via ICOs, and Sri Lanka does not allow any of these crypto-related activities in its nation. This news gave a negative impression on the crypto market, and hence, Bitcoin prices fall on Monday.

On the flip side, the number of Bitcoin ATMs across the globe were increasing day by day, and over the last six months, it has increased by 70%. The U.S. accounts for 84% of all the Bitcoin ATMs globally. America and Canada are the market leader in terms of operating Bitcoin ATMs. This news gave strength to the Bitcoin prices.

The Revolut Bank announced its most recent crypto play in the form of support for 11 new cryptocurrencies. The firm announced that 11 new tokens would be added to its exchange platform to satisfy its customers’ appetite for cryptocurrencies. The expanded support to more cryptocurrencies from Revolut Bank gave a push to Bitcoin prices.

According to the latest report, Bitcoin, compared to financial institutions, has reached four banks combined. The four banks including JP Morgan, Citigroup, Bank of America, and Wells Fargo. The market cap of Bitcoin has reached $1.121 trillion that is greater than the combined market cap of above mentioned four banks.

A digital asset investment management firm, Galaxy Digital has become the latest company for a Bitcoin exchange-traded fund with the U.S. Securities and Exchange Commission. On Monday, the firm stated its intentions to launch a Bitcoin ETF called “Galaxy Bitcoin ETF.” If approved, this will be traded on the NYSE Arca exchange.

BTC/USD Intraday Technical Levels
Support
Resistance
59531 60485
59162 61070
58577 61439
Pivot Point: 60116

BTC/USD – Technical Outlook

The BTC/USD is trading with a slight bullish bias at 60,629 level on the technical front. As discussed in the April 12 analysis, the BTC/USD pair continues to trade within a tight trading range of 61,000 – 59,250. The BTC/USD has closed a symmetrical triangle pattern that continues to keep the Bitcoin trading choppy. The violation of this pattern can extend bullish or a bearish movement in the BTC/USD pair, depending upon which side it breaks first. The technical indicators such as the MACD, Stochastics, and EMA support an upward trend; therefore, the violation of the 61,022 level can open additional room for bulls until 62,350 level. All the best!

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Technical Analysis

BTC/USD Analysis – April 12, 2021

Symmetrical Triangle in Play!

The BTC/USD was closed at 59,846 after placing a high of 60,486 and a low of 59,411. BTC/USD raised during the weekend and reached above the $60,000 level after weeks of trying to surpass this level. Bitcoin hit its all-time high (ATH) in March at $61,800, and after that, it has faced much pressure and attempted many times to cross the key level of $60,000 but failed. However, this weekend, Bitcoin advanced above this level and broke its resistance, suggesting a new ATH will be hit soon.

Earlier this week, the Bitcoin investment provider NYDIG earned an additional $100 million in growth capital. This came in after the firm invested $200 million cash injections back in early March. The rapidly growing demand for cryptocurrencies by institutional investors has led the NYDIG assets in management to reach near $6 billion. On the weekend, a Ukrainian public office made a declaration in which it stated that it allegedly owns about $2.66B amount in Bitcoin. However, Bitcoin was not the only currency held by Ukrainian state employees. Still, ETH, LTC, ADA, XLM, and many more currencies were also mentioned in the report that the officials were holding. This depicted the rising trend of cryptocurrency and pushed Bitcoin prices higher.

On Thursday, the Hong Kong tech company Meitu declared that the total value of its cryptocurrency holdings had reached near $100 million after its latest purchase of $10 million worth of Bitcoin. The rising investments in Bitcoin also added to the upward trend of its prices. The primary reason behind the increasing prices of Bitcoin could be the increased market capital of the entire cryptocurrency market. The cryptocurrency market’s whole capitalization that includes about 9190 crypto-assets, reached over $2 trillion on Saturday and pushed Bitcoin prices above $61,000 level after four weeks. Meanwhile, one of the largest Canadian brokers, Matrix Mortgage Global, has announced that it will enable its clients to spend for goods and services with some of the most popular crypto assets, including Bitcoin, Ethereum, Ripple, Bitcoin Cash, and more. This will be done with the partnership of the US-based crypto service provider BitPay.

At 17:56 GMT, the Core PPI for March advanced to 0.7% against the estimated 0.2% and supported the US dollar that capped gains in BTC/USD. In March, the PPI also increased to 1.0% against the forecasted 0.5%, kept the US dollar, and limited the rising prices of BTC/USD. At 19:00 GMT, the Final Wholesale Inventories raised to 0.6% in March against the expected 0.5% and weighed on the US dollar that added further gains in BTC/USD.

On the flip side, Bitcoin faced some pressure after a board member of the European Central Bank, Isabel Schnabel, attacked Bitcoin and claimed that the crypto asset did not fulfill the money’s properties. She also declared that Bitcoin was a speculative asset without any recognizable fundamental value and was subject to massive price swings. She finally added that the trust in cryptocurrencies might rapidly evaporate, disrupting the financial markets in the future. Bitcoin prices also failed to break their previous all-time high level due to British Bank HSBC’s advanced strictness over cryptocurrency policy. The bank now prohibits customers from buying the stock of public companies that hold bitcoin. According to this new rule, all companies with Bitcoin holdings in treasuries will be under chopping block at HSBC.

BTC/USD Intraday Technical Levels
Support Resistance
58297.2 61167.2
56770.6 62510.6
55427.2 64037.2
Pivot Point: 59640.6

BTC/USD – Technical Outlook

The BTC/USD is trading with a neutral bias at the 60,208 level, maintaining a narrow trading range of 61,000 – 59,250. On the 2-hour chart, we can see the BTC/USD has formed a symmetrical triangle pattern, and Bitcoin consolidates within this triangle pattern for now. The violation of this pattern can extend buying trend in Bitcoin until the 62,335 level. Conversely, the bearish breakout of 59,259 level can extend the selling trend until 57,850 level.

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Technical Analysis

EUR/USD Analysis – April 12, 2021

Choppy Session Continues

The EUR/USD pair is trading with a bearish bias at 1.1886 level, posting losses on the back of stronger U.S. dollar and weakness in the Euro amid poor economic data. On Friday, the EUR/USD pair was closed at 1.1896 after placing a high of 1.1921 and a low of 1.1867. The U.S. Dollar edged higher on the ending day of the week. It remained anchored near a two-week lower level, followed by the disappointing jobless figures and no signs from Federal Reserve changing its ultra-easy monetary policy stance.

The U.S. Dollar Index that gauges the value of the U.S. dollar against the basket of six major currencies soared by 0.2% on Friday and reached 92.278 that weighed heavily on the currency pair EUR/USD. The rising strength of the U.S. dollar could be attributed to the better-than-expected macroeconomic data along with the rising U.S. Treasury yields for the day.

On the data front, at 11:00 GMT, the German Industrial Production in February declined to -1.6% against the expected 1.6% and weighed on Euro that added losses in EUR/USD pair. The German Trade Balance declined to 19.1B against the expected 23.4B and weighed on Euro to add further losses in EUR/USD currency pair. At 11:45 GMT, the French Industrial Production also dropped to -4.7% against the projected 0.5% and weighed on Euro that provided strength to the downward momentum in EUR/USD pair. At 13:00 GMT, the Italian Retail Sales surged to 6.6% against the expected 2.0% and helped support Euro to cap further losses in EUR/USD pair.

From the U.S. side, at 17:56 GMT, the Core PPI for March surged to 0.7% against the anticipated 0.2% and supported the U.S. dollar that added further pressure on the already declining prices of the EUR/USD pair. The PPI in March also rose to 1.0% against the projected 0.5% to support the U.S. dollar and added further losses in EUR/USD pair. At 19:00 GMT, the Final Wholesale Inventories raised to 0.6% in March against the predicted 0.5% and weighed on the U.S. dollar to cap further losses in EUR/USD pair. The European stock markets edged lower on Friday amid the poor-than-expected German Industrial Production data.

The whole European continent is struggling against the coronavirus’s third wave as the lagging vaccination programs have decreased the economic recovery pace. In conjunction with the induced lockdowns, this has increased the concerns that the European economy will fall behind the U.K. and U.S. economy in fighting against the coronavirus. All these adverse developments have been keeping the single currency Euro under pressure lately, driving the EUR/USD pair on the downside.

EURUSD Intraday Technical Levels
Support Resistance
1.1872 1.1939
1.1833 1.1967
1.1804 1.2007
Pivot Point: 1.1900

EUR/USD – Technical Outlook

The EUR/USD currency pair is trading choppy at 1.1888 level, facing immediate resistance at 1.1903 level. A bullish breakout of 1.1903 level can lead the EUR/USD currency pair towards the next target level of 1.1946. On the 2-hour timeframe, the EUR/USD has formed an upward channel that’s supporting the EUR/USD pair around 1.1885. The bearish breakout of the 1.1885 level can drive further selling in the EUR/USD pair until the next support level of 1.1861 and 1.1822 level.

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Technical Analysis

Gold Analysis – April 12 2021

Upward Channel Breakout, Bearish Bias Dominates!

On Monday, the precious metal is trading bearish at the $1,738 level, having violated the support area of $1,746. Previously on Friday (April 09), the yellow metal gold closed at $1,744.60 after placing a high of $1,750.80 and a low of $1,733.30. Gold prices fell on Friday amid the rising strength in the U.S. dollar and the U.S. Treasury yields. However, gold prices placed weekly gains for the first time in the last three weeks.

On Friday, the U.S. dollar was strong across the board because of the rising treasury yields and better-than-forecasted economic data release. The U.S. Dollar Index rose by 0.2% on the day to reach above 92.2 level. While the supported greenback ultimately weighed on the safe-haven yellow metal prices. The U.S. treasury yield on a 10-year note rose to 1.66%.

On Thursday, the Federal Reserve Chairman, Jerome Powell, reiterated that it is unlikely for inflation to reach that higher level that will require the Federal Reserve to respond with higher rates. Thus, the U.S. central bank Federal Reserve is unlikely to change its policy rate till 2023, and all of the speculations that the FED might raise interest rates are not valid. Despite these comments from Powell, the U.S. Dollar managed to hold its foot in the financial market and continued weighing on the precious metal for the day. There’s a negative correlation between gold and the U.S. dollar; thus, an improved dollar price drives selling in the precious metal gold.

On the data front, at 17:56 GMT, the Core PPI for March raised to 0.7% against the forecasted 0.2%. Whereas the PPI figures increased to 1.0% against the expected 0.5%, supporting the U.S. dollar that ultimately added additional losses in gold. At 19:00 GMT, the Final Wholesale Inventories surged to 0.6% in March against the projected 0.5%, weighing on the U.S. dollar, consequently extending support to the precious metal gold prices. Despite posting losses for the day, gold prices still ended the week higher, with 1% gains on Friday. This came in after yellow metal appeared somewhat successful from its fencing battles with the U.S. bond yields and the U.S. dollar, which remained sluggish most of the week from mixed signals on inflation.

On the flip side, the World Health Organization (WHO) has criticized the imbalanced distribution of coronavirus vaccines between rich and emerging countries. WHO has asked for a fairer allocation of vaccines, and it has been leading the Covax Scheme that is designed to provide vaccine shots to emerging nations. According to Johns Hopkins Coronavirus Research Center, the coronavirus cases world count has reached more than 135 million with about 3 million deaths from the virus. The third wave of coronavirus spread faster due to new variants and has forced many countries to reintroduce fresh lockdown measures that have deteriorated the economic recovery hopes. Eventually, this news underpins the yellow metal gold prices.

Gold Intraday Technical Level
Support Resistance
1741.60 1765.00
1726.40 1773.20
1718.20 1788.40
Pivot Point: 1749.80

Gold – XAU/USD – Technical Outlook

At the moment, the precious metal gold is trading at the $1,740 level, and on the technical side, gold has violated the support level of $1,746. As we can see on the two-hourly timeframes, the precious metal was trading in an upward channel, extending its support at $1,746. With this upward channel’s violation, the same support level is likely to work as a resistance. Below this level of $1,746, the precious metal has strong odds of bearish trend continuation until the double bottom support level of $1,731. Besides, the leading technical indicators such as Stochastic and MACD support a selling bias, along with the series of EMA (exponential moving averages), that are extending resistance at $,1746.