The Daily Cryptomenon
This analysis was written at 9:00 am GMT +3, on 20.07.2021
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The market still hadn’t had enough time to process what’s happening as the global economic recovery has been handed a wrench that stopped its progress. This comes in the form of the Delta Variant of the COVID-19, as economies start to put restrictions once again. The EURUSD is facing the negativity of breaking below 1.1760 as the USD continues to gain more positive momentum as a safe-haven. Gold is actually feeling some negativity as well as the focus of the Bulls is too the $1,800 safe while trying to break above $1,820. Bitcoin hasn’t had the best of luck as the instrument broke below the $30,000 psychological support as Bears aim for more downside towards $28,800.
With that said, let’s find out how the markets are doing on July 20th, 2021.
Bitcoin Breaks Below $30,000
As traders opened during the European session, the cryptocurrency market was at a loss on Tuesday. The Asian session is dominated by sellers who seem adamant on exploring the rabbit hole even further. The trading price of Ethereum is back trading above the $1,700 while the Bears are attempting a push to $1,600. However, the main subject here is that Bitcoin continues with the bearish outlook after losing support of $31,000.
Huge sell orders were activated, and $30,000 hardly prevented losses. At the time of writing, due to Bulls' efforts to ensure that the decline does not continue to $28,000, the flagship cryptocurrency is trading at $29,500, which could cause serious damage if investors panic and another spike downward is activated. Indicators are showing that Bitcoin's path of least resistance is to the downside. MACD (Moving Average Convergence Divergence) indicates that the crash is still going on, especially after the recently confirmed sell signal.
It is worth paying attention to MACD technical tools, because traders can predict the trend of Bitcoin. Note that a support level above $29,000 can allow bulls to increase entry by pulling BTC above $30,000. On the other hand, the daily closing price below $29,000 will trigger another round of losses, falling to $28,000 and $25,000 respectively.
Current Market Sentiment:Bearish
EURUSD Trades Below 1.1800
The euro/dollar returned to an intraday low of 1.1790, down 0.09% from the day before the European session on Tuesday. The steady appreciation of the US dollar put this important currency pair under pressure for the fourth consecutive day. The DXY (Dollar Index) seemed to be having some advantage coming from the recent increases in the Delta Variant of COVID-19 as well as the recent turbulent talks between the US and China. On the other hand, Senate Majority Leader Chuck Schumer announced that there will be a procedural vote on the Infrastructure Act on Wednesday and hopes of more vaccines in Australia seemed to anger pessimists.
The United States recently issued a travel warning to the United Kingdom to raise concerns about Delta options and heighten concerns about market sentiment. On the same line, South Australia announced a seven-day lockdown and Victoria extended activity restrictions for one more week to roil the risk appetite. On Monday, concerns about the virus strain slowing down and recovering from the pandemic intensified concerns about reinflation, pushing the euro/dollar to its lowest level since April.
However, lack of key data before Thursday and cautious sentiment outside the European Central Bank prompted traders to rebound. Germany’s June Producer Price Index (PPI) may bring hope to ECB hawks and support the euro/dollar exchange rate, but the details of the ECB’s loan review are being reviewed for more details. First, before the European Central Bank, market sentiment was still a key factor for the currency pair.
Current Market Sentiment:Bearish
Gold's Recovery Stopped by $1,820
At the beginning of the European session on Tuesday, gold rose to approximately $1,817, which is 0.26% on the day. As market pessimists suspended their search for new key insertions, gold hit its highest daily gain in a week. The U.S. dollar is testing gold buyers with the help of a southern pause where U.S. Treasury yields are nearing a five-month low.
It is worth noting that there is hope for the US Infrastructure Expenditure Act, but the issues of the Delta Covid variant and concerns about recovery are still on the table to challenge the advancing gold traders. As a guideline, negotiations on the Sino-US war and the performance of American housing are also being formulated. Gold fell slightly from US$1,811.11 after it started to fall during the Asian session reaching $1,795.
Technically, the breakthrough of gold from the recent trading range may generate some technical interest, but the situation has deteriorated recently, and the convergence of the 10-day and 20-day EMA near $1,810. Only a daily close below the $1,800 support may upset the Bulls. At the same time, from a weekly perspective, the bears can expect a large-scale participation in the 38.2% Fibonacci resistance wall.
Current Market Sentiment:Cautiously Bullish
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