Bitcoin is still finding buyers close to $20k.

Previous BTC/USD Signal

My previous signal on 18th August was not triggered as there was no bullish price action when the support levels which I had identified were first reached that day. Unfortunately, the high of the day was just below the nearest resistance level.

Today’s BTC/USD Signals

Risk 0.50% per trade.

Trades must be taken prior to 5pm Tokyo time Friday.

Long Trade Ideas

• Long entry after a bullish price action reversal on the H1 timeframe following the next touch of $20,754 or $20,381.
• Put the stop loss $100 below the local swing low.
• Move the stop loss to break even once the trade is $100 in profit by price.
• Remove 50% of the position as profit when the trade is $100 in profit by price and leave the remainder of the position to ride.

Short Trade Ideas

• Short entry after a bearish price action reversal on the H1 timeframe following the next touch of $22,713, $23,163, or $23,609.
• Put the stop loss $100 above the local swing high.
• Move the stop loss to break even once the trade is $100 in profit by price.
• Remove 50% of the position as profit when the trade is $100 in profit by price and leave the remainder of the position to ride.

The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.

BTC/USD Analysis

I wrote in my previous analysis on 18th August that the price of BTC/USD was prone to a bearish reversal, with the resistance level at $23,609 looking attractive for a short trade as it had become likely “role reversal” resistance so would probably be likely to hold if reached. I was also interested in a long trade from the support level at $22,713.

Neither of these opportunities set up, with the high of the day unfortunately just a little below $23,609.

As it happened, during the later Asian session, the price broke down from its medium-term bullish price channel, finding a bottom just above the support level at $20,754.

The price has been consolidating since then above this supportive area, making a weakly bullish pattern of higher lows.

The price has room to rise and seems unwilling to fall further, with no key resistance levels overhead until $22,713.

Traders today might look to buy a bullish breakout above $21,900 / $22k, or alternatively hope for a retracement to the support level at $20,754 and go long following a bullish rejection there.

With today’s Jackson Hole symposium, it feels like we may see a major reversal in the US Dollar and a boost for riskier assets, which suggests upward price movement for Bitcoin.

Concerning the US Dollar, there will be a release of Preliminary GDP at 1:30pm London time, followed later by the start of the Jackson Hole symposium and Fed Chair Powell’s speech.

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The USD/INR has been able to sustain the higher values it established in the middle of last week and speculators will continue to be tested.

The Indian Rupee continues to lose ground to the USD in Forex and as of this morning a value of 79.8700 is being demonstrated.  Speculative conditions are ripe within the USD/INR currency pair as higher price action is likely causing technical traders to wonder if the 80.0000 mark is going to be challenged again. In the middle of July the USD/INR was able to trade above the 80.0000 reaching an apex of nearly 80.2200 temporarily on the 14^th of the month.

Even if the USD/INR is overbought it could go higher via Speculative Conditions

The middle of last week shook the USD/INR from a seemingly polite trading range, in which reversals lower were starting to signal evidence that the long term bullish streak from the forex pair might be slowing.  The short term trend however was proven wrong and nervous sentiment emerged again within financial institutions as whispers about more hawkish U.S Federal Reserve policy was discussed.

The publication of the Fed’s Meeting Minutes report last week indicated there is a disagreement within the U.S central bank regarding future steps to combat inflation. Troubling for traders is the fact the USD/INR is now within sight of all-time highs again, and that more fundamental news sparks will fly later this week.

Jackson Hole Talks and Preliminary GDP from U.S will affect the USD/INR this Week

The major central banks of the world this week will be getting together in Jackson Hole, Wyoming which is a symposium for financial heavyweights to discuss monetary policy. On Friday Fed Chairman Powell will speak. And before this, Thursday, the U.S will publish Preliminary GDP data. In other words traders of the USD/INR need to expect more volatility.

• If the 17.9000 mark is toppled and higher value is sustained the USD/INR could again challenge the 18.0000 in the near term.
• Behavioral sentiment is likely to remain nervous because of volatility which is certain to be caused because of policy speeches and economic data from the U.S later this week.

Traders of the USD/INR may be tempted to believe the forex pair has climbed too high and may attempt to sell. However, reversals lower in the short term will likely remain limited. Quick hitting trades are advised which are not overly ambitious today and tomorrow.

A vast sea of volatility will be demonstrated in the USD/INR later this week and risk management will be essential. The trend higher in the USD/INR may be hard to wager on for contrarians, but if support levels are tested in the short term looking for small moves upwards could prove worthwhile.

USD/INR Short Term Outlook:

Current Resistance: 79.9050

Current Support: 79.8300

High Target: 80.0300

Low Target: 79.7100

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A surging US dollar threatens to end the nascent rally in the yen, just as speculators have abandoned betting on the Japanese currency. The USD/JPY currency pair started this week’s trading with the same performance as last week by moving upwards, and its gains reached the 137.65 support level, before settling around the 137.50 level in the beginning of Tuesday’s trading. The US dollar jumped nearly 3% against the Japanese yen last week, buoyed by higher Treasury yields as traders braced for the Federal Reserve’s hawkish commentary at the upcoming Jackson Hole Symposium. The strength was broad as the greenback rose against all of its G10 peers, but it put the dollar-yen back on track to rush towards the closely watched record 140.

The renewed strength of the US dollar comes at a time when currency traders were inclined to the opinion that the worst losses of the year for the yen were behind it. The currency was hit hard by a widening interest rate gap between the US and Japan, higher oil prices and a weakening of its safe haven status, but it has rebounded since mid-July as hedge funds covered short positions.

Leveraged investors cut their net bearish bets to the lowest level since March 2021, according to the latest data from the Commodity Futures Trading Commission. While further strength in the US dollar could reignite one of the hottest macro trades of the year, yen watchers now see any pullback as temporary. But paying over $140 per dollar would renew pressure on the Bank of Japan over its super easy monetary policy and on the government to step in.

Commenting on the performance of the currency market. “USD/JPY may approach a year high at 139.39 as the market price in Powell’s hawkish speech,” Masafumi Yamamoto, chief currency strategist at Mizuho Securities in Tokyo, wrote in a note on Monday. “But given that the dollar appears to be rising faster in light of US yields, the pair may also be vulnerable to a fall after his speech as markets take into account the tightening.”

Federal Reserve Chairman Jerome Powell is expected to reiterate the US central bank’s intention to continue raising interest rates to contain inflation in his speech on Friday, eliminating speculation of a rate cut next year. In this regard, said Shinsuke Kajita, chief analyst at Resona Holdings in Tokyo: “The dollar may be supported before the emergence of Jackson Hole on the back of the Fed’s hawkish expectations with a dollar-yen range between 134 and 139 levels.” “But the pair could get heavy as the dollar’s ​​rally also has an element of risk aversion which could be reflected in the strength of the Japanese yen.”

USDJPY Technical Analysis:

• There is no change in my technical view of the USD/JPY currency pair, as the trend is still bullish.  
• Breaking the resistance 138.30 will strengthen expectations for a more important upward move, which is the historical psychological resistance 140.00.
• Many forex traders may be interested in this for short positions in anticipation of profit-taking operations.

On the other hand, on the daily chart, the move towards the support levels 135.40 and 133.00 will be important to change the current bullish trend. The currency pair will be affected today by the risk appetite of investors and the reaction from the announcement of the PMI readings for the manufacturing and services sectors and the US home sales.

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Today’s recommendation on the lira against the dollar

• Risk 0.50%.
• None of the buy or sell transactions of yesterday were activated

Best selling entry points

Entering a short position with a pending order from levels of 18.33

• Set a stop-loss point to close the lowest support levels at 18.55.
• Move the stop loss to the entry area and continue to profit as the price moves by 50 pips.
• Close half of the contracts with a profit equal to 55 pips and leave the rest of the contracts until the strong resistance levels at 17.70.

Best entry points buy

Entering a buy position with a pending order from levels of 17.85

• The best points for setting stop-loss are closing the highest levels of 17.54.
• Move the stop loss to the entry area and continue to profit as the price moves by 50 pips.

Close half of the contracts with a profit equal to 55 pips and leave the rest of the contracts until the support levels 18.31

Analysis of the Turkish lira

The price of the USD/TRY only moved slightly during today’s early trading, the dollar had risen near levels of 18 lira yesterday, before the pair returned to stability below this level. The dollar rose against the major currencies during yesterday’s trading after the announcement of the FOMC meeting minutes, which showed the possibility that the Fed will start moving interest rates at a slower pace depending on the circumstances and economic data. Some Fed members also saw the possibility of keeping the interest rate at elevated levels for a period of time even as inflation began to be brought under control.

Despite the dollar’s gains against most major currencies and emerging market currencies, the US currency did not move only slightly against the lira, as observers attributed the intervention of the Turkish Central Bank directly to impose a kind of stability for the lira price. It is noteworthy that the Turkish Central Bank is suffering from a decline in the volume of foreign exchange, but the bank has received support of several billions from Russia within the project to establish a nuclear plant in the country.

Turkish Lira Technical Outlook

On the technical front, the US dollar against the Turkish lira settled without changes within the same narrow trading range shown on the chart. The pair traded the highest support levels, which are concentrated at 17.85 and 17.75 levels, respectively. While the lira is trading below the resistance levels at 18.00 and 18.07, respectively. The pair is also trading above the 50, 100 and 200 moving averages, respectively, on the four-hour time frame as well as on the 60-minute time frame, indicating the long-term bullish trend. The chance of the lira rising against the dollar is still slim as the pair is heading in an overall bullish trend. As each decline of the pair represents a good buying opportunity, please adhere to the numbers in the recommendation, with the need to maintain capital management.

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The pair will likely have a bullish breakout in the near term.

Bullish View

• Buy the BTC/USD pair and set a take-profit at 26,000.
• Add a stop-loss at 23,500.
• Timeline: 1-2 days.

Bearish View

• Set a sell-stop at 23,500 and a take-profit at 22,000.
• Add a stop-loss at 25,500.

The BTC/USD price moved sideways and remained above the important support at $24,000 as the recent rebound stalled. The pair was trading at 24,155 on Tuesday, which was lower than this week’s high of 25,200. It is also about 37% above the lowest level this year.

Bitcoin Recovery Stalls

The BTC/USD pair moved sideways as investors focused on the relatively strong US dollar. The dollar index rose by more than 0.80% in the overnight session and was trading at $106.33, which was the highest point in about two weeks. Bitcoin has an inverse relationship with the US dollar.

Further, the performance happened as investors saw the VIX index rise by more than 2.30%. This performance was mostly because of the ongoing weakness in China.

Data published by the country’s National Bureau of Statistics (NBS) showed that industrial production, fixed asset investments, and retail sales declined in July. As a result, the country’s central bank decided to cut two important interest rates.

The BTC/USD price also wavered in line with the performance of other cryptocurrencies. ETH moved back below $2,000 while the total market cap of all cryptocurrencies declined to $1.23 trillion.

The next key catalyst for Bitcoin will be the upcoming minutes of the Federal Open Market Committee (FOMC) that are scheduled for Wednesday. These minutes will provide more information on what happened in last month’s meeting.

Still, there is a high possibility that the bank will continue hiking interest rates in the coming months even as inflation pulls back.

BTC/USD Forecast

The four-hour chart shows that the BTC price has been in a slow bullish trend since June this year. Since then, it has managed to move from a low of 17,600 to a high of 25,202. Along the way, the pair formed what looks like an ascending triangle pattern, which is usually a bullish sign. The triangle has now moved to its confluence level.

At the same time, it has moved above the 25-day and 50-day moving average. The Know Sure Thing (KST) indicator has moved above the neutral point. Therefore, because of the ascending triangle pattern and the strong performance of American equities, the pair will likely have a bullish breakout in the near term. If this happens, the next key reference level to watch will be at 26,000.

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The pair will likely have a bullish breakout this week as investors target the next key resistance point at 26,000.

Bullish View

• Buy the BTC/USD pair and set a take-profit at 26,000.
• Add a stop-loss at 23,000.
• Timeline: 1-2 days.

Bearish View

• Set a sell-stop at 23,500 and a take-profit at 22,000.
• Add a stop-loss at 25,000.

The BTC/USD price moved solidly above the resistance point at 24,000 as sentiment in the market improved. It rose to a high of 24,955, which was the highest level since June 13th of this year, meaning that it has recovered by about 40% from its lowest level this year.

Market Sentiment Improving

The BTC/USD pair continued its recovery as investors focused on corporate earnings and the falling American consumer and producer inflation.

On Wednesday, data published by the American government showed that the country’s consumer inflation dropped from 9.1% in June to 8.7% in July. In the same period, the producer price index (PPI) declined sharply as the cost of fuel pulled back.

These numbers showed that the Federal Reserve will likely slow its rate hiking cycle in the coming months. Still, most Fed officials who have talked after the data came out insisted that the bank will likely continue tightening in the coming months. They noted that inflation remains substantially above the Fed’s target of 2.0%.

The BTC/USD price also rose as the US dollar index retreated from its highest point this year. The dollar index retreated from the year-to-date high of $109.30 to about $106. This performance was mostly because of the performance of US inflation.

Meanwhile, it seems like investors are getting greedy. The fear and greed index that is tracked by CNN Money closed at 55 on Friday. This price is a few points below the greed level of 50 but it is substantially above its lowest level this year. As a result, the main American indices like the Dow Jones, Nasdaq 100, and S&P 500 have moved to a bull market.,

On the other hand, Bitcoin’s fear and greed index rose to 50, which was higher than last month’s low of 15.

BTC/USD Forecast

The four-hour chart shows that the BTC/USD price has been in a slow upward trend in the past few weeks. Along the way, the pair formed an ascending triangle pattern that is shown in purple. This triangle is usually a bullish sign. It has also remained above the 25-day and 50-day moving averages while the Stochastic Oscillator has moved slightly below the overbought level.

Therefore, the pair will likely have a bullish breakout this week as investors target the next key resistance point at 26,000.

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Bullish View

• Set a buy-stop at 24,600 and a take-profit at 25,500.
• Add a stop-loss at 22,500.
• Timeline: 1-2 days.

Bearish View

• Set a sell-stop at 23,450 and a take-profit at 22,000.
• Add a stop-loss at 25,000.

The BTC/USD price jumped in the overnight session as the market reflected on the latest US inflation data. It crossed the important resistance at 24,000 for the first time since last week and is about 35% above the lowest level this year.

US Inflation Data

The BTC/USD price jumped sharply as investors reacted to the latest US consumer price index numbers. According to the Bureau of Labor Statistics (BLS), the country’s consumer price index declined from 1.3% in June to 0.0% in July. This decline was smaller than the median estimate of 0.2%. It then translated to a year-on-year increase of 8.5%, which was lower than the expected 8.7%.

Further data showed that the country’s core inflation dropped from 0.7% to 0.3%, which was lower than the expected 0.5%. On a YoY basis, this inflation remained unchanged at 5.9%. The two figures were still bigger than the Fed’s target of 2.0%.

Therefore, analysts believe that the Fed could start slamming its brakes on hiking interest rates since inflation has started to drop. They expect that it will hike by 0.5% in September followed by 0.25% in the final two meetings of the year.

The BTC/USD pair rose after the report because of the significantly weaker US dollar. The dollar index dropped by more than 1.25% to $104.93. At its peak this year, the index was trading at $109.30. Similarly, America’s short-term bond yields slipped, with the 10-year falling to 2.788% and the 5-year dropping to2.9%.

Meanwhile, other assets also continued their comeback. Gold soared to the highest point in months while American indices like the Dow Jones, Nasdaq 100, and the Russell 2000 rose by more than 1.50%.

BTC/USD Forecast

The four-hour chart shows that the BTC/USD pair dropped to a low of 22,724 on Wednesday. This was a notable level since it was along the ascending trendline shown in green. It then bounced back after the US published weak inflation numbers. The pair has moved above the 25-day and 50-day moving averages while the MACD has moved slightly above the neutral point.

The pair will likely have a bullish breakout in the coming days. This view will be confirmed if it manages to move above the upper side of the ascending triangle pattern at 24.400.

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Still selling off from yesterday’s spike to above $1.0350.

My previous EUR/USD signal last Thursday not triggered as there was no bearish price action when the key resistance level at $1.0121 was first reached.

Today’s EUR/USD Signals

Risk 0.75%.

Trades may only be entered between 8am and 5pm London time today.

• Go short following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $1.0211 or $1.0245.
• Place the stop loss 1 pip above the local swing high.
• Move the stop loss to break even once the trade is 20 pips in profit.
• Take off 50% of the position as profit when the price reaches 50 pips in profit and leave the remainder of the position to run.

Long Trade Ideas

• Go long following a bullish price action reversal on the H1 timeframe immediately upon the next touch of $1.0073, $1.0042, or $1.0000.
• Place the stop loss 1 pip below the local swing low.
• Move the stop loss to break even once the trade is 20 pips in profit.
• Take off 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.

The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.

EUR/USD Analysis

In my last analysis of the EUR/USD currency pair on 4^th August, I noted that we were seeing strong selling every time the price got near the $1.0300 handle, but also strong buying every time the price approached the $1.0100 area.

This was a good call as the price remained ranging within this area until yesterday’s news about lower-than-expected US inflation sparked a selloff in the US Dollar, sending the price breaking out of its consolidating triangle chart pattern and spiking up to an area above $1.0350.

It is interesting that the spike not only did not last, but that we are seeing the price continue to descend consistently, with the price now trading well below $1.0300 and returning to the area of its medium-term consolidation.

This shows that the Euro is a relatively weak currency, so trading this pair long even when the US Dollar is weak is maybe not a good idea. There are other currency pairs that seem to be working better with Dollar weakness, such as any of the commodity currency pairs such as AUD/USD, NZD/USD, or USD/CAD.

Both the nearest support levels at $1.0250 and $1.0202, as well as the nearest support level at $1.0294, look firm and likely to hold at least for a while when next reached. I think scalping off reversals at any of these levels, especially $1.0250 which looks especially attractive, will be the best strategy to use in trading this pair today.

Concerning the USD, there will be a release of PPI data at 1:30pm London time. There is nothing of high importance scheduled today regarding the EUR.

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The pair will likely continue rising as bulls target the next key resistance point at 0.7055.

Bullish View

• Buy the AUD/USD pair and set a take-profit at 0.7055.
• Add a stop-loss at 0.6940.
• Timeline: 1 day.

Bearish View

• Set a sell-stop at 0.6950 and a take-profit at 0.6875.
• Add a stop-loss at 0.7060.

The AUD/USD price recovered as the US dollar retreated. The pair rose to a high of 0.7000, which was the highest point since August 2nd. It has also rebounded by more than 1.85% from the lowest level on Friday after the US published strong jobs data.

US Consumer Inflation Data Ahead

The AUD/USD pair rose slightly as the US dollar retreated. The dollar index retreated by about 0.40% in the overnight session as investors continued focusing on last Friday’s jobs data. According to the Bureau of Labor Statistics (BLS), the economy added over 528k jobs in July while the unemployment rate dropped to 3.6%.

Wages also continued rising. As a result, investors now believe that the Federal Reserve will continue hiking interest rates in the coming months. In an interview on Sunday, Mary Daly said that she supported a 0.50% rate hike in September.

In a separate report, Michelle Bowman, a Fed governor said that she strongly supported last month’s 0.75% rate hike. She added that she also supported similar rate hikes until inflation started declining in a consistent and lasting way.

There will be no major economic data from Australia. Therefore, the next key data to watch will be the upcoming inflation data from the US. Economists expect the data to show that inflation dropped from 1.3% to 0.2% on a month-on-month basis. They also expect that prices dropped from 9.1% to 8.7% on a year-on-year basis.

Further, economists expect the data to show that core CPI fell from 0.7% to 0.5%. On a YoY basis, they expect that core CPI rose from 5.9% to 6.1%. These numbers are still substantially higher than the Fed target of 2.0%.

AUD/USD Forecast

The four-hour chart shows that the AUD/USD pair has formed a double-bottom pattern at 0.6887. In price action analysis, this pattern is usually a bullish sign. It has now moved slightly above the 25-day and 50-day moving averages.

The pair has moved slightly below the first resistance of the standard pivot point while the Relative Strength Index (RSI) has pointed upwards. Therefore, the pair will likely continue rising as bulls target the next key resistance point at 0.7055. This price was the highest point since August 1st.

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The price of the USD/JPY currency pair may remain stable around its recent gains, following the strong US jobs numbers, until the most important event this week is announced. So far, the Fed’s policy tightening factors are increasing and continuing and US job numbers have dispelled fears of US economic recession even for some time. At the beginning of this week’s trading, the dollar-yen pair settled around its gains of 135.60, waiting for any news.

Future of Japanese Yen

A growing group of analysts says the biggest profits from betting on the yen – one of the hottest macro trades of 2022 – is a thing of the past. Three main pillars of the yen-selling trade are collapsing – a widening interest rate gap between the US and Japan, higher oil prices and the loss of the currency’s status as a haven as mounting recession fears keep a cap on yields, pressure crude oil and return investors to the arms of traditional safe-haven assets. The dollar-yen, which rose 38% from its lows in March 2020 to mid-July this year, is on the decline.

Rodrigo Cattrell, an analyst at National Australia Bank Ltd. In Sydney: “The big short-term yen as we know it this year is over.” And “It is now possible that the dollar-yen peak is behind us.”

Catril is joined by the likes of Rabobank and Daiwa Securities Group Inc. In anticipation of slowing losses for the Japanese currency, the worst performer in the G10 this year. Strategists see the Japanese yen rising to 130 against the dollar on average by the first quarter of 2023, according to data compiled by Bloomberg, a stark contrast to calls that 140 and above await at the peak of the drop in mid-July.

An end to what was threatening to become the currency’s worst-ever decline would be welcomed by businesses to consumers to politicians in Japan, as high import costs weigh on the post-pandemic recovery. It would justify the resolutely hawkish stance of BoJ Governor Haruhiko Kuroda and put pressure on hedge funds that came late to the popular macroeconomic strategies for the short-term yen.

The Japanese yen is closely correlated with moves in US government bonds, as the dynamic of the Bank of Japan keeping interest rates on hold even as the Federal Reserve raises significantly is weighing on the relative attractiveness of Japanese assets. Treasury yields have now slipped from their highs as traders adjust their estimates of peak US Federal Reserve interest rates and reconsider bonds on fears of a US slowdown.

“The monetary policy divergence between the US and Japan won’t be a factor anymore, as the markets have largely priced that,” said Yukio Ishizuki, senior forex analyst at Daiwa in Tokyo. It appears that the selling of the yen has reached its climax.

Benchmark Treasury yields have fallen more than 60 basis points from their June peak to 2.82% on Monday. The yen strengthened more than 3% from its low to around 135.25. “It follows that if the trend of US yields is less than some of the upside pressure that is removed from the currency pair,” said Jane Foley, an expert at Rabobank in London. It expects USD/JPY to trade as low as 130 in the coming months.

It left Japan, a net oil importer, reeling earlier this year as Brent crude futures rose around $140 a barrel. With prices now below the $100 mark, the devastating impact on import costs has eased. Accordingly, Yuki Masujima of Bloomberg Economics predicts that Japan’s trade deficit narrowed in July and that the country’s import bill increased at a slower pace thanks to cheap commodity prices.

Japanese currency is also re-emerging as a safe haven.

The yen jumped 1.3% last Monday when investors learned that US House Speaker Nancy Pelosi would visit Taiwan, raising fears of possible retaliation from China. It has risen more than 4% in the past three weeks as fears of a global recession deepen. “It looks like the Japanese yen has rediscovered its safe haven status,” said David Forrester, senior FX analyst at Credit Agricole CIB in Hong Kong. He added that weaker-than-expected US economic data limits US interest rate hike bets, which “reduce the safe-haven dollar with a high-yield attractiveness, allowing the Japanese yen to reconfirm its appeal as a safe haven.”

Hedge funds seem to be voting with their feet. Recent data from the Commodity Futures Trading Commission showed that leveraged investors cut their negative bets on the yen to the lowest level since March 2021.

Forecast of the dollar against the Japanese yen:

The price of the USD/JPY currency pair may remain stable around its recent gains until the US inflation figures are announced, which complete the picture for the US economy and the path of raising US interest rates. Currently, the nearest resistance levels for the dollar pair are 135.85, 136.20 and 137.00, respectively. On the other hand, on the daily chart, a break of the support 132.25 will be important for the bears to control. The general trend of the dollar-yen is still bullish.

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