Wednesday’s inflation data is expected to show core prices rose 0.4% month over month and is unlikely to support early rate cuts from the Fed.
German industrial production fell more than expected in March, partly due to the weak performance of the automotive sector, spurring recession fears in Europe’s largest economy again while European shares rose on Monday with energy and bank stocks leading the gains, but did range-bound ahead of U.S. inflation data later in the week.
In today’s DIFX Analytics, we’re going to look into the following assets:
Bitcoin/US Dollar (BTC/USD)
Bitcoin is trading in an asymmetric triangle. We have seen lower highs and higher lows set consistently from mid-April.
Price action on the 4-hour chart fell under the 200-day EMA and bounced off the lower trend line. We could see the price trade bullish back toward $29,000 in the near term.
The Dollar Index (DXY)
The Dollar is on a bearish path as we have seen it lose strength to other major pairs recently. This has been driven by a slowdown in rate hikes as CPI data has fallen to 5%.
The liquidity crisis has also led the Fed to consider cutting rates sooner than expected as the crisis will act as a sort of tightening as most banks and organizations will go on the defensive.
Ether/US Dollar (ETH/USD)
Ethereum is trending in a bullish fashion and technical indicators are facing upward and starting to build momentum.
Traders can expect the price to rebound to $2,000 in the near term. If the price falls below this support line then we could see a selloff.
Gold/US Dollar (XAU/USD)
Gold saw some bearish moves on Friday with nonfarm payrolls coming out much higher than expected. With CPI data released on Wednesday this week, we should keep an eye on the precious metal.
Last week, Gold hit an All-Time High and if broken, we could see it make considerable gains to $2,100.
The first major support level is $1984 which we expect price action to hit as it gains strength to make another move for $2,100.
US Dollar/Japanese Yen (USD/JPY)
USD/JPY rejected the resistance at $137.7 last week and has traded bearishly ever since. Price action is on an uptrend and we can expect more volatility entering the market on Wednesday due to CPI data.
Nonfarm payrolls came out hotter than expected so if CPI also comes out more than the forecast, Dollar can make some gains.
Euro/US Dollar (EUR/USD)
EUR/USD has been trading flat persistently for the past few weeks.
The Dollar has been slightly weaker of late due to the expectation of the Fed pausing on rate hikes and beginning cutting before the end of the year. Traders are expecting the currency to continue to trade within this range in the near term.
Disclaimer
Crypto products are unregulated and could be highly volatile. Please be aware of the risks before investing.
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DIFX shall not be responsible for any loss arising from any investment based on any recommendation, forecast or other information herein contained. The contents of this publication should not be construed as an express or implied promise, guarantee, or implication by DIFX that the forecast information will eventuate, that clients will profit from the strategies herein or that losses in connection therewith can or will be limited. Trades in accordance with the recommendations in an analysis, especially leveraged investments such as foreign exchange trading and investment in derivatives, can be very speculative and may result in losses in particular if the conditions or assumptions used for the forecast or mentioned in the analysis do not eventuate as anticipated and the forecast is not realized.
