The Daily Cryptomenon
This analysis was written at 9:00 am GMT +3, on 29.03.2021
The week appears tamed enough in its start, however with it being shortened due to Holy Friday, markets will more likely decide to remain on the sidelines.
Bitcoin has managed to bounce from the $50,000 support level and reach the high of $56,500. But, EURUSD and gold are being manipulated by the movements in the USD which continues to gain strength with the demand for safe-haven increases.
With that said, let’s find out how the markets are doing on March 29th, 2021.
Bitcoin Bounces from $50,000
After the massive downward move that broke through several important supports, this is supposed to keep a lid on any extended downward movements, so Bitcoin was able to stage a decent comeback from the lows of $50,000 and reach the resistance levels of $56,500.
The positive momentum that has manifested into this instrument has reached the top at the mentioned resistance level, as since then the instrument has been retracing lower and is currently trading around the 50-SMA which is acting as a moving support for the instrument.
Looking into the technical indicators of RSI and MACD (Moving Average Convergence Divergence), one can notice that the bullish momentum has still not been fully manifested, this result is revealed in the RSI’s movement. Also, the indicator has risen towards the 60-level which corresponds to $56,500 on the price action.
With the RSI’s inability to break above the 60-level, we can’t say that the bullish momentum is taking over as how the price action is currently moving. The MACD is also showing a decrease in the bullish momentum, with the histogram dropping back towards the midline.
The main objective for the Bulls, is to keep the correction lower from breaking below the $54,000 support zone. If the Bulls prove themselves able to do so, another bullish pressure could be expected, it can break above the $56,500 level along with the 100-SMA.
Above all that, BTC will be facing a resistance zone between $57,000 and $57,200, and breaking through that zone will only embolden the Bulls even further as they make their way towards $60,000.
Current Market Sentiment: Cautiously Bullish
EURUSD Remains Capped at 1.1800
Despite the best efforts from the EURUSD Bulls, the instrument’s upward movements remain limited below the 1.1800 resistance level. So, traders seem to remain quite cautious and enter defensive mode as a holiday-shortened U.S. payrolls week kicks off.
The movements in the USD remain the main factor to look out for when trading this instrument as the greenback keeps the negative pressure mounting on the major, however, this comes in response to a positive robust economic recovery in the U.S. alongside an increased pace of vaccinations.
However, the USD cannot be the only instrument to be blamed for the decrease in EURUSD. EUR, also had a hand in the increase of the downward pressure. The continued delays in the vaccination rollout and increasing COVID-19 cases in Europe has only managed to darken the cloud hanging over the economic recovery in the Old Continent. Moreover, additional infrastructure spending coming from the U.S. government has only served to support the greenback with American-Sino nervousness giving the USD more demand as a safe-haven.
The week should start off on a tamed note, however, traders will then likely pick up the pace as the date of U.S. payrolls comes closer. Traders will be looking for any movements in the USD that might point to how the U.S. payrolls are coming.
This week’s NFP (Non-Farm Payroll) will be the risk event of the week, and since markets will be closed on Friday (Holy Friday), traders will more than likely keep an eye out for major changes before they head home for a long weekend.
Current Market Sentiment: Cautious Trading
Gold Continues a Two-Week Consolidation
Any movement in the precious metal remains limited, whether it’s to the upside or the downside. The 50-SMA and the 100-SMA on the 4-hour chart is keeping a lid on any meaningful movement in gold. The yellow metal will need to break through either of those moving averages, if it wishes to step out of the consolidation which has completed its two weeks as of today. However, with the NFP coming in this week, the downside movement in gold is becoming more and more likely to happen.
The upward movement in the USD comes on the back of a solid economic recovery and successful vaccine campaigns in the U.S. In addition to that, China’s growing worries and coronavirus cases worldwide, serves to boost the safe-haven appeal of the dollar at gold’s expense.
On the other hand, rising inflation expectations and the US infrastructure spree help put a floor under gold prices. Looking at the wider image, this only serves to deepen the consolidation hold on gold.
Looking into the resistance and support structure of gold, we can notice that the precious metal will have a hard time to rise, as a dense cluster of resistance levels appears situated between $1,735 and $1,737. A break above that cluster, the Bulls will have the $1,745 level to compete against.
On the other hand, the support around $1,725 which is situated at the 100-SMA will make it hard for the Bears to gain any kind of meaningful downward move. Below which the Bears will more than likely target the previous month low at $1,717 which the Bulls’ line in the sand.
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