Bitcoin Technical Analysis – Support Levels in Play

Bucking the trend from across the broader market, Bitcoin fell by 3.38% on Saturday. Partially reversing a 10.18% rally from Friday, Bitcoin ended the day at $11,920.

A particularly bearish start to the day on Saturday saw Bitcoin slide from an intraday high $12,338 to an early morning intraday low $11,354.

In spite of the early sell-off, Bitcoin steered clear of the first major support level at $11,285.67 and the 23.6% FIB of $11,275.

Finding support from the broader market, Bitcoin managed to recover to $12,200 levels before sliding back to sub-$12,000 levels.

For the current week, Bitcoin was up by 9.3%, which came off the back of 4 days in the green out of the last 6.

In what was a choppy week for the broader crypto market, Bitcoin was one of just 3 of the top 10 cryptos to be in positive territory for the current week.

As a result of the current week gains, Bitcoin’s dominance continued to hold at 62%.

Bitcoin’s bullish week saw the Bitcoin’s market cap rise from $190bn to a Thursday high $245.13bn before easing back. At the time of writing, the market cap stood at $210.82bn.

24-hour trading volumes were also on the up, rising from $20bn levels to hit $46bn levels on Thursday. At the time of writing, 24-hour trading volumes stood at $39.4bn.

For the Bitcoin bulls, the near-term bullish trend, formed at mid-December’s swing lo $3,215.2 remained intact. Bitcoin continued to hold above the 23.6% FIB of $11,275, with a 39.7% rally for the current month leading to a 211% gain year-to-date.

This Morning

At the time of writing, Bitcoin was down by 0.59% to $11,850.

A choppy morning saw Bitcoin rise to an early morning high $12,234 before hitting reverse.

Falling short of the first major resistance level at $12,390.33, Bitcoin fell to a mid-morning intraday low $11,681. In spite of the pullback, Bitcoin steered clear of the first major support level at $11,397.33 and the 23.6% FIB of $11,275.

BTC/USD 30/06/19 Daily Chart

For the Day Ahead

A move back through to $12,000 levels would support another run at the first major resistance level at $12,390.33.

Support from the broader market would be needed, however, for Bitcoin to break out from this morning’s high $12,234.0.

Barring a broad-based crypto rebound, Bitcoin would likely come up short of $12,300 levels on the day.

In the event of a 2nd half of a day bounce, a breakthrough the first major resistance level would bring $12,500 levels into play before any pullback.

Failure to move back through to $12,000 levels could see Bitcoin fall deeper into the red. A fall through the morning low $11,681 would bring the first major support level at $11,397.33 into play.

Barring an extended broad-based crypto sell-off, Bitcoin should steer clear of the 23.6% FIB of $11,275 on the day.

The article was written by Bharat Gohri, Chief Market Analyst at easyMarkets

Global Equities Bounce on Hopes of Trade War Resolution

US Equities Bouncing After Yesterday’s Tumble

Equity markets in the United States were weighed by less dovish than expected Fed rhetoric on Tuesday. Fed member Powell reiterated his stance that the bank will adjust as necessary to keep the recovery going. There was some expectation for him to signal a cut in July, but he did not do so.

Perhaps the more relevant speech came from Fed member Bullard who is a known dove. Bullard had dissented at the Fed meeting last week, opting to cut rates instead. He commented yesterday that a 50 basis point rate cut would be excessive. Ahead of the speeches, the markets had been fully pricing in a cut next month. They had also priced in a 42% probability of a 50 basis point cut.

With Bullards comments, the likelihood of a 50 basis point cut seems quite slim, considering he is the most dovish voting Fed member. The S&P 500 declined about 1% yesterday to a 4-day low.

There seems to be much more optimism in the markets today as the futures are up about a fifth of a percent at the time of writing. The origin is from an interview conducted by CNBC with Treasury Secretary Steven Mnuchin. When asked about progress in the trade war, and whether a deal could be made by the end of the year, Mnuchin commented that he could not speculate on that. He added that the US was previously about 90% of the way to reaching a deal and that he thought “there is a path to complete this”. He added that he wanted China to come to the table in hopes of coming to a resolution.

Gold Prices Pull Back to End a Six-Day Winning Streak

The price of gold dropped in early day trading today towards $1400 after reaching a high of $1439 yesterday. Gold prices have been weighed by a bounce in the dollar and the slight shift in rate cut expectations since yesterday’s Fed speeches.

Treasury yields were mostly unchanged with the 10-year yield hovering just above 2%. The yield has been consolidating within a tight range since late last week. Oil prices extended gains to trade about 0.4% higher at the time of writing. WTI Crude oil faces important technical resistance from an intersection of the 100 and 200-day moving averages.

European Markets Gained While Some Asian Markets Struggled

In Europe, the German DAX is leading the indices at mid-day. The index had a soft open but rallied in early day trading to wipe out much of the week’s loss prior to settling a bit lower.

The Japanese Nikkei 225 extended losses earlier today by half a percent. The Nikkei dropped to a one-week low and has erased last weeks gains. The index was weighed by a weaker yen as USD/JPY sprung higher in Asian trading. The exchange rate hit a low below the 107 handle earlier this week but appears to be poised to test the 108 handle which is an important price point for the pair.

New Zealand’s NZX 50 traded mostly unchanged on the day after the RBNZ kept rates unchanged today. The Reserve Bank of New Zealand was expected to leave the interest rate at 1.5% but some economist had thought they might cut further today. Analysts at New Zealand Bank ANZ expect that policymakers will ease in August.

The article was written by Bharat Gohri, Director of Sales and Retention at easymarkets.com

Futures Rise Alongside Bonds and Oil Prices

The US Futures are Pointing to a Slightly Higher Open on Monday

US equities rallied along with the global markets late last week when the Fed announced a dovish policy shift. This led to a rally in the S&P 500 to record highs. The index is facing some resistance from prior highs and has not made a sustained break as of yet. The last two times the index traded near this resistance area, it led to a notable correction. The first for about 20% while the second saw the index decline just over 7%.

The Fed’s monetary policy stance will tend to underpin US equities, however, market participants are still looking for a de-escalation in trade wars. Trump and Xi will be meeting at the G20 summit in Japan this week. Ahead of the meeting, the markets may fall in a bit of a lull as investors await the outcome.

US Treasuries rallied in early day trading with the 10-year yield creeping closer to 2%. The yield has declined for seven consecutive weeks as the markets outlook of the economy is much bleaker than US policymakers. At the time of writing, the 10-year yield was down one and a half percent.

After a sharp recovery last week, oil prices are off to a good start. Light crude oil futures caught a strong bid at the European open and are about half a percent higher on the day. The greenback edged lower in the first half of European trading. The trade-weighted dollar index (DXY) fell 1.5% last week on rate cut expectations and trades at a three-month low.

European Equities Pared Recent Gains Ahead of the US open

European equity indices were mostly lower at Midday with the German Dax posting the largest loss. The German index shed half a percent after the last IFO data showed business morale declining to a five-year low.

The IFO institute reported a decline in its business climate index to 97.4 in June from 97.9 in the prior month. It was the third consecutive month that the index declined, although analysts had been looking for a slightly larger drop. Manufacturing and services sectors are getting hit the hardest.

Asian Markets Extended a Bit Higher

Asian equities edged higher with the Nikkei 225 adding just over a tenth of a percent on Monday. The Japanese index has not been participating in the global rally as a result of last week’s Fed meeting and has mostly traded sideways for the past three weeks.

The Hang Seng index rose 4.55% last week and briefly rose to a fresh six week high today prior to settling near its opening price. New Zealand’s NZX 50 index broke to a fresh record high once again. The Reserve Bank of New Zealand is scheduled to meet later this week. While some analysts think that policymakers will cut rates yet again, the consensus is for the bank to stand pat.

The article was written by Bharat Gohri, Director of Sales and Retention at easyMarkets

Oil Rebounds On Bullish Data, OPEC Meeting Date Set, Trade-Optimism Fuels Demand Hopes

The oil inventory data was compounded by unexpected draws in distillates and gasoline that suggest rising U.S. production isn’t keeping up with demand. Traders had been expecting modest builds of inventory for both gasoline and distillates.

Declining imports of oil and fuel stocks contributed to this week’s decline in net inventory. Imports fell by -144,000 barrels per day bringing the YOY total to -7.6% over last year. Refinery runs increased over the past week which may offset the unexpected declines in gasoline and distillates in the coming weeks. Despite the drawdown, the total amount of energy product delivered in the U.S. is up 1.8% YOY over the trailing four-week period. This increase is led by a 2.0% increase in gasoline product delivered and a 4.0% increase in distillate products.

OPEC Sets Meeting Date

OPEC has finally set the date for its next policy meeting. The energy cartel has been wrangling over when it would meet to discuss the future of production caps put in place last year. The group is slated to meet in two weeks, July 1st, with a follow meeting with the OPEC+ nations the next day. At present, the cartel has cut production by 1.2 million barrels per day from nominal levels. Saudi Arabia has already come out in support of extending or deepening cuts whose purpose is to support prices. The cartel is not expected to lift the production cap at this meeting.

Trade-Optimism Fuels Demand Hopes

A series of Tweet’s from U.S. President Donald Trump on Tuesday have lifted optimism a trade-deal will be reached soon. The President said he had a long talk with Chinese President Xi Jinping and that the two will be meeting at the G-20 in Japan. The G-20 meeting is scheduled for June 28-29 in Osaka, Japan and provides neutral ground for the two to meet. Lingering trade tensions have sapped global growth acceleration and in turn demand for oil, a resolution of those tensions would be a bullish catalyst for oil prices.

The article was written by Bharat Gohri, Director of Sales and Retention at easyMarkets