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Technical Analysis for Bitcoin, Euro vs U.S. dollar, and Gold for 24th June 2021

The Daily Cryptomenon

This analysis was written at 9:00 am GMT +3, on 24.06.2021

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The market is still reeling from the effects of the FOMC and Powell’s testimony, but now new events are coming through as they focus on how Biden's infrastructural plan is making more headway in Congress, which gives more power to the USD. EURUSD and Gold are both feeling the pressure from such developments as corrections and consolidations are the main focus of traders. Bitcoin is also showing some additional bullishness, but it seems unable to really break above $35,000 for the time being.

With that said, let’s find out how the markets are doing on June 24th, 2021.


Bitcoin Recovery Tops at $35,000

Bitcoin rebounded from the $29,000 sell-off earlier this week. The flagship cryptocurrency closed at $35,000 but failed to continue to rise to $40,000. The pullback is under increasing overall pressure, resulting in losses of up to $32,000. If the Bulls do not launch another attack mission at a price of $40,000, Bitcoin may fall to $30,000 when the sell order is triggered.

Bitcoin has been touted as digital gold from the beginning, according to billionaire businessman Mark Cuban, Bitcoin is better than gold by all standards. For example, he emphasized that BTC is easier to trade, merge, split and transfer. Both Bitcoin and gold are used to hedge against inflation. However, Cubans speak of preciousness; metals "are unusable in almost all areas, but are mainly used as coatings." In his view, BTC is a digital asset, just like gold, which depends entirely on supply and demand. BTC does a better job in both of these aspects.

 



At the time of writing, the price of Bitcoin is $35,500. The main goal is to provide further support, preferably at the level of $32,000, to make way for the resumption of the upward trend. The Relative Strength Index (RSI) confirms the increasingly bearish control. Therefore, before a sharp rebound, Bitcoin is likely to return to the $31,000 support level. On the other hand, Bitcoin needs to gain a foothold above the upper limit of the $35,000 range to support the existence of Bulls in the market. In addition, the MACD outlook remains bullish, indicating that the Bulls have the ability to support the upward trend in the short term.

Current Market Sentiment:Bearish


EURUSD Unable to Break Above 1.1950

The buying interest in the U.S. dollar made the euro/dollar nervous during the Asian session on Thursday morning. After testing the high of 1.2263 in late May, the euro lost against the dollar. At the time of writing, the EUR/USD was trading at 1.1924, which was down by 0.01%. The US 10-year Treasury yield prints at 1.49%, an increase of 0.34%. The dollar index (DXY) tracks government bond yields and remains strong at 91.82.

The Fed’s mixed comments on inflation and interest rate forecasts are having an impact on the U.S. dollar. Atlanta Fed President Rafael Bostic said that he expects interest rates to rise by the end of 2022, economic growth will accelerate by 7%, and inflation this year will be higher than the Federal Reserve’s 2% target. Both Bostic and Fed Chairman Michel Bowman believe that the recent easing of price pressures may take longer than expected.


Janet Yellen warned Congress on Wednesday about the risks of debt default and the possible new financial crisis. These comments are affecting the sentiment of the dollar. In addition, the U.S. Senators reached an agreement on the U.S. spending bill. Infrastructure and plans to discuss with President Joe Biden today. On the other hand, due to the attractive valuation of the U.S. dollar, profits from the common currency are limited. The optimistic data on the domestic economy may not lead to a stronger euro.

Current Market Sentiment:Bearish


Gold Seems on the Backfoot

Gold shows that the market is lagging. Although it rebounded from the intraday low before the European session on Thursday, it fell 0.23% to near $1,773 during the session. Concerns about COVID Delta variant also benefit gold sellers, although the lack of a clear direction and timetable keeps traders waiting for new catalysts to better understand the market.

After Fed Chairman Jerome Powell reiterated that inflation risks are temporary and not a major issue of current Fed policy, Boston Federal Reserve Bank President and CEO Eric Rosengren predicted: "Most price increases will be reversed next year.” Similarly, US Treasury Secretary Janet Yellen said, “Most inflation expectations are still reasonable.” In contrast, Atlanta Fed President Rafael Bostic and Dallas Fed Chairman Robert Kaplan had firm confidence in the Fed’s next move, but received less praise.

 

 


At the same time, U.S. senators rushed to pass President Joe Biden’s infrastructure spending bill before the two-week holiday, but the Democratic Party has a huge gap between the push and the requirements of the Republican Party. In the absence of key dates/events, gold traders are looking for new clues about US durable goods orders due on May 2.7%, compared with 1.3% before. In addition, headlines about the virus and US stimulus measures, as well as the struggle between China and the United States, can also provide a reliable benchmark for gold prices.

Current Market Sentiment:Consolidation


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