The Daily Cryptomenon
This analysis was written at 9:00 am GMT +3, on 29.04.2021
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The markets were left rising higher after the FOMC decided to keep their monetary policy stance as is, allowing for the instruments to rise against the USD. However, bitcoin appeared to be the odd instrument out as it remained consolidating below $56,000. The bullish momentum appears to be fading as the lack of any proper follow through is hurting the BTC’s chances of another move higher.
EURUSD and Gold are both enjoying the positive atmosphere after the FOMC decision. Both instruments have continued to move higher as the EURUSD hits late February highs, while Gold manages to break above the $1,780 resistance and recapture some of the bullish momentum that it was losing.
With that said, let’s find out how the markets are doing on April 29th, 2021.
Bitcoin Struggles at $56,000
Despite a build up in the positive momentum we highlighted yesterday, Bitcoin was unable to properly continue moving higher as it remained stable below $56,000. BTC was able to break above the $55,000 level, however it quickly found that $56,000 had many sellers waiting for the instrument that resulted in a consolidation move below the mentioned level. The Bulls were able to spike above $56,000 but lacked any proper follow through in the upward move and that resulted in a move below the resistance.
The consolidation on this instrument remains intact, however, the bias is definitely to the downside, as the instrument is trading below $54,000. The bottom bound of the consolidation zone located at the 50-SMA on the 4-hour chart around $52,600 is the obvious target for Bears, but the Bulls aren’t letting go without a fight. The technical indicators are looking rather neutral as of this writing, but that could all change if the Bears were to break below the 50-SMA.
If bitcoin remains stable above the mentioned SMA and $53,000, it could start a fresh increase. An initial resistance on the upside is near the $55,500 level. The next major resistance is near the $56,000 level. A successful close above the $56,000 resistance zone could set the pace for a move towards the $58,000 level in the near term.
Current Market Sentiment:Cautiously Bearish
EURUSD Refreshes Two-Month High
As the Asian session draws to a close and the European one kicks off, we see the EURUSD rising to a fresh high since late February while also showing signs of higher momentum to the upside. This allows the major currency pair to print gains for three consecutive days after managing to shrug off the negative momentum and bouncing from the 50-SMA on the 4-hour chart.
The main event risk of yesterday, the FOMC rate decision, showed the Fed defending their easy monetary policy which has put a dent in the anticipated USD recovery. However, Biden’s mammoth fiscal stimulus is likely to propel the inflation further towards the north, which in turn could recall reflation fears and the USD much-awaited recovery.
Looking forward, the preliminary reading of the German Harmonized Index of Consumer Prices for April, expected to stay unchanged, will be initially important as German policymakers have been trying to renew tapering talks. Ahead of that, the ECB’s Vice President Luis De Guindos’ speech and second-tier sentiment data could offer intermediate direction to the EURUSD prices.
Current Market Sentiment:Cautious Bullish
Gold Bulls Focus on $1,800 to Extend Gains
Gold is consolidating near four-day highs but remains below $1800 so far as the European Session kicks off. Fed Chair Jerome Powell’s dismissal of tapering bets gave the much-needed boost to the XAU Bulls. Meanwhile, US President Joe Biden pushed for his $1.8 trillion stimulus package, which exerted additional upside pressure on gold.
The US Treasury yields fell across the curve amid expectations of prolonged policy support from both the government and the central bank, supporting the non-yielding gold. This of course is helped by the technical background as the resistance and support structure is showing that the path of least resistance for Gold is to the upside. The instrument is currently battling against the $1,785 resistance, but breaking higher opens up the path to test the $1,800 which the Bulls are hungry for.
On the downside, gold is facing strong supports around the $1,773. Should those fail to hold any kind of bearish move then the 100-SMA as well as the $1,760 support will come into play to keep the bullish momentum alive. However, looking into the technical indicators, we see the RSI printing right at the 60 level, as it shows that the move higher might be losing momentum, while the MACD is right at the midline, showing a neutral stance.
Current Market Sentiment:Neutral
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