Bitcoin, Bitcoin / US Dollar, Federal Reserve, People’s Bank of China, Iron Ore, Crude Oil, US Dollar / Swiss Franc – Talking Points
- Bitcoin recovers from weekend losses, but risk appetite remains low
- Raising interest rates is hampering growth prospects, pushing industrial metals down
- With a quiet week of data ahead, central bank speakers will be the center of attention
Bitcoin broke below the psychological 20,000 mark over the weekend. It touched as low as 17,599 on Saturday before recovering again over 20,000 on Sunday. Monday saw the price jump above and below 20,000 several times.
Risky assets have seen their prices dent as central banks globally tighten monetary conditions to combat inflation.
This deflationary stance has raised fears of a recession and it has become clear that the Fed is likely to steer the US economy into a slowdown to rein in runaway prices.
on Saturday, Federal Reserve Governor Christopher Waller He said he would support a further 75 basis point hike at the FOMC meeting in July.
Stock markets remain under pressure and bourses in the Asia-Pacific region were mixed after a similar lead from Wall Street on Friday. Futures markets are pointing to a slightly positive start to the monetary session in North America.
The People’s Bank of China (PBOC) left the initial interest rates for the 1- and 5-year loan unchanged as expected today.
The bank made it clear that it favors a easing bias, but there are significant concerns about the economic outlook for mainland China as the shutdown continues to affect.
This iron ore reservoir saw more than 10% on Monday on the Dalian Commodity Exchange (DCE). It is also lower on the Singapore Stock Exchange (SGX) but to a lesser degree.
Other steel products also experienced significant losses. As a result, the number of Australian mining stocks fell significantly.
Crude oil was unable to hold the rally early Monday and continues to decline near Friday’s close. Concerns about global growth and fears of destroying demand continue to undermine it. Gold settled near $1,844 an ounce.
The Swiss Franc was the best performing currency at the start of the week after last week’s sudden 50 basis point rise from the Swiss National Bank. The US dollar is declining at the moment.
Looking at the calendar, it appears to be a bit light compared to the central bank’s actions last week. Today’s focus will be on speakers from the European Central Bank, the Bank of England and the Federal Reserve. The spotlight is likely to be on European Central Bank President Christine Lagarde.
You can view the full economic calendar over here.
Bitcoin / USD Technical Analysis
BTC/USD remains below the descending trend line. Nearby support could be at the late 2020 lows at 17,575 and 16,520.
On the upside, resistance could be recent high at 22945 or break point at 25350.
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— By Daniel McCarthy, Strategist for DailyFX.com
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