The Daily Cryptomenon
This analysis was written at 9:00 am GMT +3, on 22.03.2021
For todays important economic announcements, visit our Economic Calendar.
The markets are starting this week powerfully for each instrument and with a clear target in mind. Bitcoin is challenging the Bulls’ commitment to attempt any further upside movements, as it fails to break above the $60,000.
EURUSD proceeds to be affected by the absence of an economic recovery in the Eurozone, and the positive aspects of the U.S. economy. However, gold appears to find some negative pressure building up as Fed Powell takes the stage once again to provide fresh impetus.
With that said, let’s find out how the markets are doing on March 22nd, 2021.
Bitcoin Turns Red
The mentioned resistance zone between the $59,000 and the $60,000 has kept a lid on any gains that Bitcoin might post. The inability of Bulls to effectively break through this zone has allowed the Bears to capitalise on the loss of momentum and pushed the instrument below the $58,000, reaching even below $56,000.
However, with the presence of buyers at those lower levels, this provoked the instrument to have a decent bounce as it currently battles against the 50-SMA on the 4-hour chart.
The RSI and MACD are showing a decrease in the bearish pressure, however, it can’t be ruled out. The RSI is currently printing around the 50-midline indicating that there’s a bit of consolidation in the future of the instrument if the indicator remains around that level.
Also, one would also notice that the indicator is printed around 40, but didn’t break below, revealing that despite the bearish momentum, the Bulls are still looking to regain control over the instrument.
The first support of the instrument is seen around the $56,000 level which coincides with the 100-SMA on the 4-hour chart. If the instrument manages to break below these levels, the instrument might continue its negative decline towards the $54,000.
The 200-SMA on the 4-hour chart will also play a major role in keeping any negative pressure in check, while the Bears will have their eyes on the $50,000 as an ultimate target. However, the presence of many strong supports between here and there, the Bears will have a tough go at it.
Current Market Sentiment: Somewhat Bearish
EURUSD Fills Gap with Limited Upside
The EURUSD started the week with a bearish gap, however, the instrument was able to cover the gap during the Asian session and is trading just below the 1.1900 mark, as the European session kicks off. The instrument has been able to stop the recent pullback, after the EURUSD was unable to break above the 1.2000 resistance level.
The U.S. Treasury yields also played a role in keeping the EURUSD above the 1.1880, the yields retreated from their highs which inturn gave the USD enough weakness to allow for some movements higher.
The upbeat economic outlook from the U.S. could prove a good chance for the USD to regain some of the strength it had, which would serve to limit any upside that the EURUSD might come across. This optimism in the U.S. market gives investors hope for a fast expected recovery which will fuel inflation and then push the Fed’s hand into increasing interest rates.
On the other hand, the Eurozone continues to be plagued by increased infection rates and pandemic-related lockdowns, which limit any meaningful upside in the EURUSD
The economic calendar for today appears dominated by the EU Current Account Figures and the U.S. Existing Home Sales, as investors look for a fresh input to decide which way to trade. However, the focus will come in the form of a Speech by Fed Powell in a virtual panel discussion, along with a large amount of FOMC member speeches during the trading day.
However, this will impact the price dynamic of the USD, which would produce interesting trading opportunities for the EURUSD.
Current Market Sentiment: Limited Bullish MomentumGold Shows Negative Pressure
As the USD regains some bullish presence, due to the resurgence in safe-haven demand, the precious metal gold finds itself under bearish pressure under the $1,750 which it has been trying to break above since the FOMC release last week.
The current increase in the USD comes along with the weekend decisions by the Turkish President, Erodogan. The fears of an overheating Turkish economy has given rise to an increased demand for the USD which has added negative pressure on gold.
Also, there’s the recent Fed decision which includes a capital break on big banks. This has weighed heavily on the yellow metal and kept it pinned for the time being. The instrument is now focused on the speech by Fed Powell later today, as it might provide some fresh impetus for the precious metal and dictate the next trading cycle of the instrument.
Looking at the resistance and support structure of the instrument, we can notice that gold is challenging the Bears’ commitment for a downside with the strong support around the $1,735.
Breaking below this level would expose the $1,733, which coincides with the 100-SMA and 50-SMA on the 4-hour chart. Any lower and the instrument will be facing the $1,720 and the $1,717 as the ultimate targets for Bears.
Current Market Sentiment: Increased Bearish Pressure
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