The Daily Cryptomenon
This analysis was written at 9:00 am GMT +3, on 07.07.2021
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With the market still relatively off, since July is an off month, investors have been seen coming back for the day as the FOMC (Federal Open Market Committee) Meeting Minutes are set to be released later on in the day. This is important as traders will get a better glimpse on how the FOMC is thinking when it comes to the monetary policy decision. EUR and Gold traders are both waiting for this event as the negative atmosphere continues to push EUR downwards and Gold upwards. Bitcoin is consolidating for the most part and it also looks to the support and resistance levels to break out of it.
With that said, let’s find out how the markets are doing on July 7th, 2021.
Bitcoin Consolidates Below $35,500
Bitcoin climbed above the $35,000 resistance level but failed to increase profits. Before the new downward correction, BTC was trading at $35,130. It fell below the $34,500 support level and the 100-hour moving average. The instrument was even trading under that level at one point, however, the focus is on $34,000, with the Bulls having been active around $33,500. The low was formed at $33,594 and now seems to be consolidating losses.
The hourly chart of the BTC/USD currency pair seems to be forming a large trading triangle, with the support level at around $33,750. If BTC does not stay above the triangle support level, and then stays at $33,600, it may fall sharply, and might end up closing near the $33,250 support. If the support levels of $33,250 and $33,000 are broken, the price is expected to fall further. Any further loss may push the price to the support level of $32,200.
If Bitcoin remains stable above the triangle support level and the $33,600 area, it may start a new rebound soon. The recent upside resistance is near the $34,500 and the triangle's uptrend line. The next major resistance is at $35,000, above which the price may attempt a strong rebound, and above the $35,000 resistance zone, the price may rise to $36,500.
Current Market Sentiment:Consolidation
EURUSD Struggles Above 1.1800
The EUR/USD Bears are testing the areas above 1.1800, falling by 0.03% from 1.1820 before European time on Wednesday. However, as risk appetite fades and safe-haven assets are provided to the US dollar, major currency pairs are in a three-day downtrend as the important minutes of the Federal Open Market Committee (FOMC) meeting are set to be released today.
Global market sentiment remains pessimistic. With mixed data, US traders are looking for new evidence to prove that the Fed’s tough policy is reasonable, this comes in the wake of non-farm payrolls (NFP) which have jumped to a 10-month high, the employment data released on Friday dampened the Fed’s hopes of raising and lowering interest rates, but the unemployment rate has also risen. The overall continuation of the Coronavirus as well as the recent commentators have emphasised that Epsilon and Lambda are key challenges to the unimpeded flow of the Western economy.
The minutes of the FOMC meeting and the special meeting of the European Central Bank (ECB) appeared to be reviewing risk appetite and EUR/USD traders when they were released. Monetary policy needs to be tightened. If there’s a large gap in expectations, the euro/dollar may fall further in preparation for tomorrow's European Central Bank meeting.
Current Market Sentiment:Bearish
Gold Price Breaks Above $1,800
Gold (XAU/USD) kept rising for the sixth consecutive day, rising by 0.34% and reaching $1,801 in early trading on Wednesday. The market sentiment, however, remains pessimistic, mainly due to concerns about the coronavirus (COVID-19). For gold buyers, the U.S. dollar seems to have fallen recently. Despite this, DXY buyers are taking a breather at 92.52, and after recording their strongest one-day gain the day before, they fell by 0.03% in one day.
The resurgence of the coronavirus and vaccine resistance tensions were inconsistent with the June Purchasing Managers Index of the US Service Industry Index, which suppressed market sentiment on Tuesday. The return of American traders after a long weekend drove this response. They are still in a state of slight sell-off, and the yield of 10-year US Treasury bonds is still at a low level near the end of February. Due to the risky tone leading to investors wanting a safe haven, the price of gold rose overnight. However, after plummeting from the high, gold prices were slightly under pressure and consolidated on Wednesday.
The instrument started to stay flat after falling from the previous day's high of US$1,815.04, and Wall Street closed at US$1,797.21, although it rose from the highs of $1,790. The market is waiting for FOMC members to further confirm when it will start. A more positive shift in participants’ meeting minutes is expected to support the dollar’s surge, especially after the disappointing data released in Europe on Tuesday.
Current Market Sentiment:Bullish
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