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Technical Analysis for Bitcoin, Euro vs U.S. dollar, and Gold for 16th March 2021

The Daily Cryptomenon

This analysis was written at 9:00 am GMT +3, on 16.03.2021

For todays important economic announcements, visit our Economic Calendar.

The markets are waiting for the FOMC and Vaccine updates which dominate the airwaves. Bitcoin experienced fresh downward momentum, after India’s proposed ban of all cryptocurrencies. EURUSD and gold are both facing down the specter of the FOMC with their decision on Wednesday, making for one interesting market when that comes into view.

With that said, let’s find out how the markets are doing on March 16th, 2021.


Bitcoin in Freefall

It’s just how the song goes “I’m Free, Freefalling!” That’s where we found the pioneer cryptocurrency after Bitcoin failed to continue the bullish momentum and break above the $61,800. However, the instrument continued to fall breaking through several important resistance, the chief among them was the $58,400 which was the resistance-turned-support, making the whole dynamic change.

The main reason for the big fall is due to India. The country proposed a bill that bans both the usage and the mining of all cryptocurrencies in its borders. In fact, this triggered a lot of sell orders forcing the instrument lower.

The gravitational force that is affecting the instrument is nowhere near done, as the target appears at $50,000, which is acting as the relative floor of the instrument. Currently, the instrument seems trading above the $54,000, which is acting as a short-term support.

On the other hand, with how the instrument is acting, it won’t be long before the instrument falls below the mentioned level, but if the Bulls have any chance of turning this gravitational force off, they would need to break above the 50-SMA on the 4-hour chart, meaning above $56,150.



The first meaningful support level is seen around the 100-SMA on the 4-hour chart at $52,150, with the 200-SMA also playing a role between the current price of BTC and the $50,000 price level. However, the MACD (Moving Average Convergence Divergence) is emphasizing the downside of the instrument, suggesting that this move is nowhere near done, especially with the histogram increasing in pace, indicating that the Bears are in control of the instrument.

Current Market Sentiment: Bearish


EURUSD Experiences Limited Upside

Previously, we had discussed how the common currency is trading in an extremely tight range. Well, this range has now turned into a descending triangle on the 4-hour chart on a small scale, when such a pattern comes into the chart, it usually means a reversal is about to happen. However, the 50-SMA is keeping a lid on any gains that the EURUSD instrument might achieve, while the 1.1920 is keeping a solid floor, that’s about to break by the looks of the below chart.

The U.S. Treasury yields continue to play a major role in how the instrument is trading. The recent pullback in the yield, had put the USD on the defensive, which in turn gave the EURUSD some support to keep things steady for the time being.

Now the focus shifts to the FOMC and their two-day meeting which is starting today. Traders are expecting the Fed to put a curb on the increase in the long-term borrowing costs. this is why markets are expected to stay in their consolidation range until the end of the two-day meeting.



Traders have been refraining from applying aggressive bullish bets on the EURUSD, after numerous concerns regarding the Oxford/AstraZeneca vaccine in several European countries that it might be causing blood clots. This forced Germany, France and Italy to temporarily halt the vaccination rollout, because of these severe side-effects. On the other hand, the Bears won’t be entering the market either because of the aforementioned FOMC meeting.

Current Market Sentiment: Consolidation


Gold Consolidates

The precious metal gold poses small gains as Bulls set their eyes on the $1,740 resistance level along with the 100-SMA, which coincide with the mentioned level. This formed a cautious tone, when trading granted safe-haven trades a good push higher. The sentiment remains lukewarm in the markets as vaccine concerns and an FOMC meeting looms over everything in markets, while the drop in the U.S. Treasury yields gave the non-yielding metal some positive news to digest.

However, gold’s fate lays in the hands of the Fed and their announcement is expected to be released on Wednesday. However, for the time-being, the U.S. retail sales might provide some fresh impetus to the market.

From a technical point of view, the price action is showing that the instrument is targeting the $1,740 as it battles against the 100-SMA on the 4-hour chart and 21-SMA on the daily chart, making it one tough nut to crack.

 


In order for the bullish momentum to continue playing a role in the gold market, the price action would have to break above the aforementioned SMAs and levels, breaking through the $1,740, this would allow the Bulls to target the $1,760 in an attempt to get back above the $1,800 in due time. Technical indicators are showing some bullish momentum forming, however, it’s very muted with the MACD histogram printing close to the midline while the MAs are above it signaling muted bullish momentum.

Current Market Sentiment:Consolidation


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