The pair will likely remain in the current range and then have a bearish breakout after the US jobs data.

Bearish View

• Set a sell-stop at 1.0130 and a take-profit at 1.0045.
• Add a stop-loss at 1.0235.
• Timeline: 1-2 days.

Bullish View

• Set a buy-stop at 1.0225 and a take-profit at 1.0300.
• Add a stop-loss at 1.0125.

The EUR/USD currency pair came under intense pressure after the strong American jobs numbers pointed to more tightening by the Federal Reserve. The pair dropped to a low of 1.0160, which was slightly below last week’s high of 1.0300.

More Fed Tightening Likely

The EUR/USD pair made a strong bearish breakout as investors reflected on the latest US non-farm payroll data. According to the Bureau of Labor Statistics (BLS), the economy added over 528k jobs in July, a strong surprise since analysts were expecting it to add just 225k jobs. It was also better than the adjusted 392k jobs that were created in June.

Additional data revealed that the unemployment rate dropped from 3.6% to 3.5% in July. This decline was equally better than what analysts were expecting. Further, the labor participation rate and wages continued rising. These numbers imply that the American economy took two years to recover the 22 million jobs it lost during the pandemic.

Therefore, these numbers imply that the Federal Reserve will likely continue with its rate hike campaign to defeat the soaring inflation. Data published in July showed that America’s inflation rose to a multi-decade high of 9.1% in June.

The next major catalyst for the pair will be the upcoming US inflation numbers scheduled for Wednesday. Economists expect the data to show that the country’s inflation fell from 9.1% to 8.7% on a year-on-year basis. They also believe that it dropped from 1.3% to 0.2% on a month-on-month basis as the price of gasoline dropped. Still, inflation remains significantly above the bank’s target of 2.0%.

There is no major scheduled economic data from Europe this week. Therefore, focus will remain on the US dollar as global risks rise. The war in Ukraine is going on while China has ramped pressure on Taiwan.

EUR/USD Forecast

The four-hour chart shows that the EUR/USD pair has remained between the important support and resistance levels at 1.0100 and 1.0296 in the past few weeks. It dropped slightly after the latest US jobs data and moved slightly below the 25-day moving average.

At the same time, the pair remained above the 23.6% Fibonacci Retracement level. Notably, it has formed a small head and shoulders pattern. Therefore, the pair will likely remain in the current range and then have a bearish breakout after the US jobs data.

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The pair will likely remain in this range as investors wait for the reopening of American markets.

Bullish View

• Buy the BTC/USD pair and set a take-profit at 21,000.
• Add a stop-loss at 18,000.
• Timeline: 1 day.

Bearish View

• Sell the BTC/USD pair and set a take-profit at 17,800.
• Add a stop-loss at 21,000.

The BTC/USD pair moved sideways as concerns about the health of the cryptocurrency industry continued. Bitcoin is hovering around $20,200 where it has been in the past few days. This price is slightly above last month’s low of $17,623.

Concerns About Cryptocurrencies

There are rising concerns about the cryptocurrency industry. In May this year, Terra’s ecosystem disappeared, costing investors over $40 billion. In June, Celsius, a company that operated as a crypto bank suspended withdrawals and swaps in a bid to prevent a bank run.

Similarly, BlockFi, which was once a market leader in the industry came under intense pressure. As a result, FTX is said to be buying the firm for about $25 million. As part of the agreement, FTX will provide $250 million in liquidity for the company.

Meanwhile, more exchanges are suspending withdrawals. During the weekend, Voyager Digital, a Canadian exchange announced that it was pausing withdrawals and deposits. This happened since the company was the most affected by the recent collapse of Three Arrows Capital.

The most recent company to suspend withdrawals, trading, and deposits is Vauld, a company that is backed by Coinbase and Peter Thiel. The firm said that it was suspending operations in a bid to prevent a bank run after users withdrew $200 million in the past three weeks. The firm is now engaging financial and legal advisors to explore all options.

The BTC/USD pair is consolidating as investors worry about the lack of demand for cryptocurrencies. While some existing holders like MicroStrategy are buying the dip, there are currently very few new buyers.

As a result, it could take time for the BTC/USD pair to stage a strong recovery considering that the Federal Reserve is still tightening.

BTC/USD Forecast

The four-hour chart shows that the BTC/USD pair has been in a tight range in the past few days. The pair has managed to bounce back from last week’s low of 18,750 to about 20,000. It has moved slightly above the 25-day and 50-day moving averages while the Relative Strength Index (RSI) has pointed upwards. The RSI is above the neutral point at 50 and the moving average shown in yellow.

Therefore, the pair will likely remain in this range as investors wait for the reopening of American markets. In case of more upside, the next key resistance point to watch will be at 21,000.

The pair will likely consolidate in this range today. 

Bullish View

• Set a buy-stop at 30,500 and a take-profit at 32,000.
• Add a stop-loss at 27,500.
• Timeline: 2 days.

Bearish View

• Set a sell-stop at 28,700 and a take-profit at 27,000.
• Add a stop-loss at 31,000.

The BTC/USD price is still in a tight range as investors watch the overall market sentiment. Bitcoin is trading at $29,897, which is in the same range it has been in the past few days. This price is about 17% above the lowest level this month.

Fear and Greed Retreats

The BTC/US pair has been moving sideways in the past few days as investors remain pessimistic and fearful about the market. The fear and greed index has declined to the extreme fear level of 11, which explains why both stocks and cryptocurrencies have declined sharply.

The latest cause of fear was the ongoing margin compression in the United States after the recent results by Target, Walmart, and Kohls. All these retailers said that their profit margins have thinned sharply in the past few months as the cost of doing business rose.

As a result, shares of most retailers have plummeted in the past few days, with Target falling by 29% in the past five trading sessions. Walmart shares plummeted by 19% while Kohls fell by 20%.

These companies are important because of the special role that consumer spending has on the American economy. As a result, their results helped to push the Dow Jones and Nasdaq 100 indices sharply lower, with the S&P 500 hovering above its bear market level.

All these factors have an impact on the BTC/USD pair because of the ongoing correlation between stocks and digital currencies.

Meanwhile, recent options data show that the decline has more room to run. The put/call ratios for bitcoin open interest has jumped to the highest level in 12 months of 0.72. This is a signal that investors are still more bearish since investors are anticipating that the sell-off will continue.

BTC/USD Forecast

The BTC/USD pair remained in a consolidation mode. It is trading at 29,700, where it has been in the past few days. It has formed a symmetrical triangle pattern that is shown in red. Also, the pair has moved to the 25-day and 50-day moving averages while the MACD indicator has moved slightly below the neutral level.

Therefore, the pair will likely consolidate in this range today. Later this week, a strong bullish or bearish breakout cannot be ruled out. If this happens, the key support and resistance levels to watch will be at 28,500 and 30,770.