Gold bulls have been consistent as Dollar weakness overshadows the market. The non-yielding asset is gaining attraction from the market with investors moving their cash from risk-off to risk-on.
The Dollar fell toward the end of last week with inflation data coming out at 6.5% which signals a cool-off in the rising prices. This was also confirmation that the Fed would potentially only hike 25 basis points at the next FOMC meeting.
We have seen CPI data soften consecutively for the past months with no mixed signals from the data. It’s been quite persistent in presenting a slowdown in growth.
EUR/USD saw some gains but is now consolidating with indicators pointing to a retracement. Bitcoin is bullish and we are seeing upside moves in the entire crypto market. The digital asset hasn’t signaled this much strength on technical indicators for over a year.
In today’s DIFX Analytics, we’re going to look into the following assets:
Bitcoin has seen massive bulls and has crossed through the $20k level. We saw some resistance at $21k over the weekend as traders may have taken some profits.
RSI is very strong hitting levels on the daily that haven’t been crossed for over a year.
Price action on the daily has broken the Exponential Moving Averages on the 50 and 100-day which confirms further positive moves for the asset.
The Dollar is bearish with a slide to hit lows of $101.7. We are seeing negative price action after the inflation data confirmed inflation is cooling off.
We are also seeing bears due to a 25 basis point rate hike being priced in at 90% probability against a 10% chance of 50 basis points.
We can expect the Dollar Index to fall to these next support levels in the near term.
EUR/USD triple tops on the daily hitting a high of $1.0874. We are seeing a bearish divergence in the asset as the technicals signal downside momentum.
We are expecting a retracement down to $1.07342 in the short term. Traders should keep in mind that the Dollar is still weakening in the long term and after this retracement, we can see EUR/USD bulls returning.
Gold is seeing more bulls as it crosses the resistance at $1916. CPI data showing a cool-off in inflation has spurred investors to move cash into the asset.
Fundamentally, we see Gold strengthening toward the next resistance at $1945. RSI has broken to the upside with confirmation of bulls from a technical view as well.
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