The Daily Cryptomenon
This analysis was written at 9:00 am GMT +3, on 03.08.2021
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The lack of major economic events/data puts the market ahead of an indecisive day, hence leading traders to focus on the qualitative information rather than quantitative one. Fedspeak will also play a major role, because any news by Jerome Powell and Co. will have a significant impact on the markets as a whole.
EURUSD is currently consolidating at the 1.1880 resistance level and seems on track to break above 1.1900 with some technical help. Gold is consolidating the losses it made following the drop from the highs of $1,830, while the current cluster of SMAs at the bottom is keeping things in check. Bitcoin is extending its losses as the Bears are targeting the $37,000 support level, and a move to $35,000 can be expected, should that fail to keep things under control.
With that said, let’s find out how the markets are doing on August 3rd, 2021.
Bitcoin Extends Losses
Cryptocurrencies are facing greater overall pressure, which makes it difficult for the Bulls to maintain their winning streak in the past two weeks. Initially, Bitcoin rose from a level below $30,000 to a high above $40,000, this move didn’t just benefit Bitcoin, but the entire cryptocurrency market. The $42,000 correction for the flagship cryptocurrency seems to have resulted in a full loss.
After adjusting from the weekend high of $42,500, the leading cryptocurrency hovered at $38,750. As sales orders increase, the chances of staying above $40,000 has been reduced. In addition to that, the current 200-SMA (Simple Moving Average) is currently contributing to total pressure. At the same time, the main goal is to provide additional assistance, the instrument will have to break higher, preferably above $38,000.
Bulls are currently coming up with an action plan as they are looking for a move above $40,000. However, traders should pay attention to the MACD (Moving Average Convergence Divergence) sell signal. As per the indicator on the 4-hour chart, this means that the bullish outlook is fading and sellers are gaining the upper hand. If MACD narrows the midline gap, Bitcoin may not stop at $38,000, but it may extend its bearish leg to $35,000.
Current Market Sentiment:Bearish
EURUSD Remains Below 1.1900 Amid Inaction
The EURUSD remained on the sidelines after falling to 1.1870 before the European session on Tuesday. As a result, the major currency pair stopped its two-day downtrend, even if there were no major changes recently. The latest inaction in the instrument can be attributed to the concerns about the Delta Covid Variant as well as monetary relief package headlines. According to Reuters, including comments from the Centers for Disease Control and Prevention (CDC), the Delta variant of the virus "may be more severe than the previous version."
Similarly, due to the COVID19 strain, China’s restricted areas have been restored and Australia is experiencing difficulties. It’s worth noting that the euro/dollar price did not outperform, despite the German retail sales forecast in July, and the manufacturing purchasing managers' index in the previous month of the euro zone was revised upwards. It is worth noting that recent data on the level of activity in China has also disappointed the market while expressing concerns about the global economic recovery and pandemic.
There isn’t much going on in terms of major events or data being released, so EURUSD traders will be focused on the qualitative catalysts and a fresh round of Fedspeak for fresh impetus. From a technical point of view, the common currency is showing a bullish pattern forming, but Bulls will be waiting for some kind of confirmation before committing to long positions. In case the instrument is able to break above 1.1900, then the next level to be targeted is 1.1910 followed by 1.2060.
Current Market Sentiment:Sideways Trading
Gold Consolidates Losses
The yellow metal has edged lower towards the $1,810, which represents a 0.15% fall on an intraday basis. This comes as the instrument prepares to start the European session on Tuesday, with some mixed events clouding the waters. Concerns about the coronavirus fought against hopes of additional stimulation, which led gold to create a doji candle formation on the charts on Monday. Unlike European PMI upward revisions and German retail sales rising, bearish PMI data from the United States and China, have created a problem for the yellow metal.
The latest development of commodities is based on US Treasury bonds, as the bond coupon pauses after posting the lowest daily closing since February. Behind this move in Treasury Bonds could be the fears that the Delta Covid strain is much more severe than anticipated, according to the CDC, and the International Monetary Fund’s (IMF) historical allocation of $650 billion to its Special Drawing Rights (SDR).
The price of gold has been trading in familiar ranges since mid-July and early August and attempts to break the $1,830s have failed on two occasions, so far. The market this week has seen gold better offered and in Asia on Tuesday, the price of the yellow metal has been pushed to a low of $1,809.52. The highest level reached, so far, has been $1,813.98 but the US dollar is climbing out of the dumps, at least it is attempting to do so following a negative day on Wall Street.
Current Market Sentiment:Sideways Trading
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