The pair will likely have a bearish breakout as sellers target the key support at 20,000.

Bearish view

• Sell the BTC/USD pair and set a take-profit at 20,000.
• Add a stop-loss at 23,500.
• Timeline: 1 day.

Bullish view

• Set a buy-stop at 22,000 and a take-profit at 24,000.
• Add a stop-loss at 20,000.

The BTC/USD price moved sideways as investors reflected on the recent sell-off. The pair was trading at 21,550 during the Asian session, which was significantly lower than this month’s high of 25,271. Other cryptocurrencies like Ethereum and BNB also continued moving sideways.

Bitcoin sell-off pauses

Bitcoin has been in a strong comeback since June. It managed to move from the year-to-date low of about $17,600 to a high of 25,155. This rebound happened as investors bought the dip in both cryptocurrencies and global equities.

This week, however, the pair has lost its bullish momentum and crashed to the lowest level since July 26. Analysts attribute the sell-off to the recent minutes, which showed that the Federal Reserve was committed to hiking interest rates.

Fed officials believe that more hikes are necessary in order to prevent inflation from being entrenched in the economy. At the same time, they are worried about hiking too fast, which could lead to a hard landing of the economy.

The BTC/USD stabilized as the US dollar index pulled back slightly following weak housing and PMI numbers from the US. The data showed that the services sector contracted hard in August while new home sales dropped by a whopping 12.3%. Therefore, analysts expect that the Fed will slow on its hikes.

Another concern among investors is that network activity has been a bit weak in the past few weeks. The number of new addresses in the network has been under pressure during the recent rally. Also, according to Glassnode, miner revenue from fees has also been a bit weak.

In addition, exchange flows have dropped to the lowest level since late 2020 while speculative interest has been falling. These numbers imply that cryptocurrencies likely went through a bear market rally.

BTC/USD forecast

The BTC/USD price has been in a strong bearish trend in the past few days. The sell-off paused on Tuesday as the pair remained slightly below 22,000. It has moved below the 25-day and 50-day moving averages.

In addition, the pair crashed below the lower side of the ascending triangle pattern that is shown in purple. The MACD also moved below the neutral level while the pair has formed what looks like a bearish flag pattern. Therefore, the pair will likely have a bearish breakout as sellers target the key support at 20,000.

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There is a likelihood that Bitcoin will continue falling as bears target the important support level at $27,000.

Bearish View

• Sell the BTC/USD pair and set a take-profit at 27,000.
• Add a stop-loss at 31,000.
• Timeline: 2 days.

Bullish View

• Set a buy-stop at 30,500 and a take-profit at 32,000.
• Add a stop-loss at 28,000.

The BTC/USD pair is still in a consolidation mode in the past few days as demand for digital coins ease. Bitcoin is trading at $29,350, where it has been in the past few days. This price is about 15% above the lowest level this month.

Bitcoin Demand Slows

The BTC/USD pair has been in a tight range in the past few days as its correlation with American stocks continued. For example, as stocks rose sharply on Monday, Bitcoin rose by more than 200 points.

Now, Bitcoin has retreated as American futures point to a weak open after Snap downgraded its growth forecast. American stocks have had a close correlation with Bitcoin in the past few weeks.

Meanwhile, data in the options market show that investors believe that Bitcoin could keep falling in the next few weeks. For example, the closely watched put/call ratio has risen to the highest level in more than 12 months. This is a signal that the options market is still pessimistic.

At the same time, on-chain data show that the volume of Bitcoin being traded every day has been in a strong downward trend. Worse, long-term holders have started to distribute their holdings since most of them are currently in the loss-making territory.

The next key event that will move Bitcoin will be a statement by Jerome Powell. In it, the Fed chair will provide his opinion about the state of the economy and what the bank plans to do. In his recent statement, he warned about the pain that the market will feel when this tightening continues. The pair will also react to the upcoming minutes by the Federal Reserve.

BTC/USD Forecast

Turning to the daily chart, we see that the BTC/USD pair has been in a strong bearish trend in the past few days. The sell-off saw the price drop below the important support level at $32,935, which was the lowest level on January 24th. The downward trend is also being supported by the 25-day and 50-day moving averages.

Notably, the pair has formed what looks like a bearish flag pattern. Therefore, there is a likelihood that Bitcoin will continue falling as bears target the important support level at $27,000. A move above the resistance level at $31,450 will invalidate the bearish view.

There is a likelihood that the pair will have a bearish breakout as bears target the key support at 1.0500.

Bearish View

• Sell the EUR/USD and set a take-profit at 1.0450.
• Add a stop-loss at 1.0625.
• Timeline: 1-2 days.

Bullish View

• Set a buy-stop at 1.0600 and add a take-profit at 1.0650.
• Add a stop-loss at 1.0500.

The EUR/USD is stuck close to the lowest level this year as investors focused on the interest rate decision by the Federal Reserve and the average US jobs data. The pair is trading at 1.0545, which is slightly above last week’s low of 1.0467.

Fed and NFP Data

The EUR/USD pair was in a tight range last week as investors reflected on the mixed events that happened last week. In the first place, data by Markit and the Institute of Supply Management (ISM) showed that the US and EU manufacturing and services sectors were cooling down as inflation continues.

The biggest event last week was the interest rate decision on Wednesday. In its decision, the bank decided to deliver its biggest interest rate hike in more than 20 years. It also hinted that it will continue hiking interest rates in the remaining meetings in a bid to counter the soaring inflation. Precisely, it noted that the neutral rate will be at 3%.

The EUR/USD pair also reacted to the latest American jobs data. The economy added 428k jobs in April while the unemployment rate moved to 3.6%. At the same time, wages held steady above 5% as the labor shortage continued rising.

In response to these jobs numbers, the bond and stock markets continued their sell-off. The 10-year bond yield, which moves inversely to prices, rose to a high of 3.14% while the 30-year rose to 3.2%. The Dow Jones and the Nasdaq 100 fell by more than 0.30%.

The pair will next react to important data from the United States. On Wednesday, the US will publish the latest consumer price index (CPI). Economists expect the data to show that inflation by 8.1% while core CPI rose by 6.1%. These numbers will provide signs that the American inflation has started peaking.

EUR/USD Forecast

The EUR/USD pair continued struggling last week as the market reflected on the latest jobs data and the FOMC decision. On the four-hour chart, the pair has formed a bearish flag pattern and moved below the 25-day and 50-day moving averages. The pair has also moved between the lower and middle lines of the Bollinger Bands.

Therefore, there is a likelihood that the pair will have a bearish breakout as bears target the key support at 1.0500. A move above the key resistance at 1.0600 will invalidate the bearish view.

There is a likelihood that the pair will have a bearish breakout as bears target the key support at 1.0500. 

Bearish View

• Sell the EUR/USD and set a take-profit at 1.0450.
• Add a stop-loss at 1.0625.
• Timeline: 1-2 days.

Bullish View

• Set a buy-stop at 1.0600 and add a take-profit at 1.0650.
• Add a stop-loss at 1.0500.

The EUR/USD is stuck close to the lowest level this year as investors focused on the interest rate decision by the Federal Reserve and the average US jobs data. The pair is trading at 1.0545, which is slightly above last week’s low of 1.0467.

Fed and NFP Data

The EUR/USD pair was in a tight range last week as investors reflected on the mixed events that happened last week. In the first place, data by Markit and the Institute of Supply Management (ISM) showed that the US and EU manufacturing and services sectors were cooling down as inflation continues.

The biggest event last week was the interest rate decision on Wednesday. In its decision, the bank decided to deliver its biggest interest rate hike in more than 20 years. It also hinted that it will continue hiking interest rates in the remaining meetings in a bid to counter the soaring inflation. Precisely, it noted that the neutral rate will be at 3%.

The EUR/USD pair also reacted to the latest American jobs data. The economy added 428k jobs in April while the unemployment rate moved to 3.6%. At the same time, wages held steady above 5% as the labor shortage continued rising.

In response to these jobs numbers, the bond and stock markets continued their sell-off. The 10-year bond yield, which moves inversely to prices, rose to a high of 3.14% while the 30-year rose to 3.2%. The Dow Jones and the Nasdaq 100 fell by more than 0.30%.

The pair will next react to important data from the United States. On Wednesday, the US will publish the latest consumer price index (CPI). Economists expect the data to show that inflation by 8.1% while core CPI rose by 6.1%. These numbers will provide signs that the American inflation has started peaking.

EUR/USD Forecast

The EUR/USD pair continued struggling last week as the market reflected on the latest jobs data and the FOMC decision. On the four-hour chart, the pair has formed a bearish flag pattern and moved below the 25-day and 50-day moving averages. The pair has also moved between the lower and middle lines of the Bollinger Bands.

Therefore, there is a likelihood that the pair will have a bearish breakout as bears target the key support at 1.0500. A move above the key resistance at 1.0600 will invalidate the bearish view.

There is a likelihood that it will soon have a bearish breakout to retest last week’s low of 1.0473.

Bearish View

• Sell the EUR/USD and set a take-profit at 1.0480.
• Add a stop-loss at 1.0650.
• Timeline: 1 day.

Bullish View

• Set a buy-stop at 1.0600 and a take-profit at 1.0650.
• Add a stop-loss at 1.0500.

The EUR/USD pair is crawling back as investors rush to buy the dip following the spectacular decline in April. The pair is trading at 1.0545, which is slightly above last week’s low of 1.0472. That price was the lowest it had been since 2020 and was about 6% below the highest level in April.

Eurozone Concerns Remain

The EUR/USD has been under intense pressure in the past few weeks as investors remain concerned about the divergence between the Fed and the European Central Bank (ECB). The Fed is expected to sound more hawkish when it completes its meeting later this week. The overall expectation is that the bank will deliver a 0.50% rate hike and signal that it will deliver such hikes later this year.

Signs of a hawkish come at an interesting time for the American economy. Data published last week showed that pending home sales dropped for the fifth straight month. Further numbers revealed that the American economy had its first contraction since 2020 in the first quarter.

Therefore, there are concerns that the Fed’s tightening to fight inflation could have the unintended consequences of causing a recession. Besides, the yield curve made its first inversion in years a few weeks ago.

The key data to watch today will be German retail sales. Economists expect the data to show that sales rose by 0.3% in March on a month-on-month basis, leading to an annualized increase of 6.1%. The European Commission will also publish the latest business and consumer confidence numbers. Economists expect the data to show that the service sentiment rose to 14.2 while the industrial sentiment fell to 9.5.

The EUR/USD will also react to the latest Eurozone and US PMI data. Still, the biggest focus among investors will be focused on the upcoming Fed decision and the latest non-farm payrolls (NFP) data.

EUR/USD Forecast

The EUR/USD pair has been in a strong bearish trend in the past few days. It has attempted to crawl back in the past few days. The price is trading at the middle line of the Bollinger Bands and is slightly below the 23.6% Fibonacci retracement level.

At the same time, the Relative Strength Index (RSI) has moved slightly above the oversold level while the Stochastic Oscillator is approaching the overbought level. It has also formed what looks like a bearish flag pattern. Therefore, because of this pattern, there is a likelihood that it will soon have a bearish breakout to retest last week’s low of 1.0473.

Right now I think the only thing we can count on is that things are going to be very noisy over the next several weeks.

The S&P 500 fell a bit on Wednesday to test the bottom of the bullish flag that we have been trying to form. The 50-day EMA is where the market stopped and finally turned back around. By doing so, the market looks very likely to continue seeing buyers, and a bounce from this point could send the market back to the top of the flag pattern.

If we can break above the downtrend line that makes up the top of the flag, then we could go much higher. That being said, there are a lot of concerns out there that continue to plague the markets, and it is likely that we will see a lot of volatility because of it. Ultimately, this is a market that given enough time will have to make a bigger decision, but right now it appears that we are at a bit of a loss as to what we want to do.

The Federal Reserve has released the FOMC Meeting Minutes during the day on Wednesday, showing signs of hawkishness that people were not aware of. If that is going to continue to be the case, it could cause even more volatility in the stock index. It should be noted that the S&P 500 almost solely moves on the idea of liquidity and has nothing to do with economic reality. The S&P 500 pulling back to the 50-day EMA in the futures market and bouncing is a good sign, but right now I think the only thing we can count on is that things are going to be very noisy over the next several weeks.

If we were to break down below the candlestick for the trading session on Wednesday, it could open up a move to the 200-day EMA, which is right at the 4400 level. Breaking down below that level then opens up the possibility of an even bigger drop, perhaps opening up the S&P 500 futures to go down to the 4200 level. At this point, this is a market that continues to see that area as an area where there have been a lot of buying pressure in the past.

Remember, rallies during bear markets tend to be very vicious, and that could have been what we have just seen.

S&P 500 futures fell on Tuesday as the market has seen so much in the way of noise overall. This is a market that I think will continue to see noisy behavior, as there are a lot of uncertainties around the world. The S&P 500 is dealing with the idea of higher interest rates coming out of the United States, and it will perhaps weigh upon the index. The market has fallen from the top of the potential flag pattern, so I think it is only a matter of time before the buyers have to make a bigger decision.

If we were to break above the downtrend line of the flag, then it is obviously a bullish sign. The 4585 level is where we had previously seen a bit of a double top. This double top being broken to the upside then shows a continuation of the bullish pressure that could send this market higher. This would obviously open up the possibility of bigger games, but right now Wall Street has to decide whether or not interest rate hikes are going to continue to be something to fear.

Underneath, we have the 50-day EMA coming into the picture at 4456 and rising, so pay close attention to that area and see whether it would continue to offer support. If we were to break down below that level, then it is likely that the 200-day EMA near the 4400 level could be the next target to the downside. Breaking below there would then signify a downtrend yet again and could send markets scrambling. The market continues to see a lot of volatility, and probably the only thing that you will be able to count on is the choppiness.

As central banks around the world will continue to think about tightening, this will have a drastic effect on profits, and it is very likely that the S&P 500 still will think of this as “swimming upstream.” Ultimately, we need some type of impulsive and large candlestick to determine where we are going next. It certainly looks as if we are trying to build a bullish flag, but we need things to turn around rather quickly to get things moving in a positive manner. Remember, rallies during bear markets tend to be very vicious, and that could have been what we have just seen.