Risk Warning: CFDs and margin FX are leveraged products that carry a high level of risk to your capital. Trading is not suitable for everyone and may result in you losing substantially more than your initial investment. Please consider our PDS

Technical Analysis - Chart of the week

Viable Long positions above $37500 that is the Major Pivot point at this stage. Long position with the first target at $40400 and with the extension towards $42000. If prices fall below $36700 and consolidate around it then possible short positions towards $36700 the key support level and then $34500. If the BTC/USD moves towards $33800 then it might continue to decline towards $30,000 which is the crucial level of support.

XBT/USD

Halt in Crypto Currencies rebound rally!

  • Resistance Zone: $42000 to $42500
  • Key Resistance Level: $40400
  • Support Zone: $34500 to $33800
  • Key Support: $36700
  • Major Pivot Point: $37500
  • 50 Day SMA – Green Line
  • 100 Day SMA – Red Line

Trade Insights – Analysis of BTC chart shows – Viable Long positions above $37500 that is the Major Pivot point at this stage. Long position with the first target at $40400 and with the extension towards $42000. If prices fall below $36700 and consolidate around it then possible short positions towards $36700 the key support level and then $34500. If the BTC/USD moves towards $33800 then it might continue to decline towards $30,000 which is the crucial level of support.

XBT/USD 4 Hourly Chart

Chart Analysis:

Directional bias: 2 Weeks XBT/USD

Technical Analysis of XBT/USD 4 hourly chart shows that the pair has broken the uptrend parallel channel and currently sitting above the support structure after giving up some of the recent gains. In the month of June, the prices were moving downward with lower highs and lower lows to the point of $29300 and from here there was a reversal in the downtrend as BTC appeared oversold to investors. This changed the outlook and there was a sharp and quick upward movement of prices into an ascending parallel channel and prices touched the recent high of $42600 on 1st August. The channel has apparently broken now. The prices are trying to consolidate and defeat the downward pressure as of now.  The chart shows that the major Pivot point is at $37500, whereas the pair is trading currently at $38070.

If the pair finds support above the Pivot and after consolidation, the Buyers could take back the control and may move the prices higher towards the Key Resistance level of $40400. After this, the next resistance level is at $42000 to $42500. The chart also shows that if the BTC doesn’t find support at the current level, then Sellers would continue to move the prices lower and can hit the Support zone of $34500. Interestingly, on the 4 hourly charts, the prices have fallen below the 50-Day SMA indicator line and just trading between the 50 days and 100-day SMA levels. This shows that with further weakness the prices could move further downwards in next the few sessions. Whereas, on the daily chart the 50-day SMA indicates a BUY signal.

Fundamental summary: Crypto supporters Cathy Wood, Elon Musk and Jack Dorsey have contributed majorly into the recent Bull run of Cryptos via personal tweets and interviews in recent weeks. Whereas Amazon denied the allegation that they will accept Cryptos which has put a stop to a rebound in the digital currency. Amidst investors move towards Safe-haven assets to counter a surge in Covid and clamp down on regulators on the ability to trade and invest in digital assets the Cryptocurrency is facing bigger challenges that may unfold in the coming months.

EUR/USD

NFP to decide the course for EUR/USD in a neutral August Month.

  • Resistance Zone: 119.80 to 120.10
  • Key Resistance: 119.17
  • Support Zone: 117.70 to 117.50
  • Key Support: 118.23
  • Major Pivot Point: 118.55
  • 50 Day SMA – Green Line
  • 100 Day SMA – Red Line

Trade Insights – Viable Short positions below 118.55 as the prices are consolidating above this level. If the prices move lower, then the first profit-taking could be at 118.23 and then 117.70. If the prices move higher above the Pivot of 118.55 then Buyers could take the opportunity for long trades towards 119.17 and then 119.80.

EUR/USD Daily Chart

Chart Analysis: 

Directional bias: 2 Weeks EUR/USD

Chart Analysis of EUR/USD pair shows that the prices are holding between the key support of 118.23 and key resistance level of 119.17. It seems after the rebound from lows of 117.50 the prices are consolidating at the current levels and from here the future course of action could be decided. The Major Pivot point on the chart is apparently at 118.55 which is also a support area of 23.60% of Fibonacci retracement from the peak of January to the trough of March. It seems that if the prices manage to stay above this level there could be a higher follow-through move towards the key resistance level and if that is broken too then the prices could test the Resistance Zone between 119.80 to 120.10

However, as the market is waiting for the NFP data on Friday 6th August, and if the prices take a downward turn and the dollar rises, then Bears can first test the Key support level at 118.23 and then head towards the structural support zone of 117.70 to 117.50. The SMA Cross indicator suggests Sell action at the current prices as the 50 Day Indicator from above and 100 Day indicator from below has crossed. It seems there is a resistance at current levels and the pair is struggling to move higher from here.

Fundamental summary: August is a neutral month historically for EUR/USD pair from a seasonal perspective. As inflation is easing and it is reflecting in the declining commodity prices of Oil, lumber and Copper, the interest rate hike is not so hot agenda for Federal Reserve as it was in the month of June. The US treasury yields are lowering, and this is a tricky situation for the US dollar. The NFP news is due this week Friday, and this can decide the direction for the pair in the coming few days.  

Open a FREE CFD demo trading account

Disclaimer

The information provided is of a general nature and is not intended to be personalised financial advice. The information provided is not intended to be a substitute for professional advice. You may seek appropriate personalised financial advice from a qualified professional to suit your individual circumstances.

Trading in Rockfort Markets derivative products may not be suitable for everyone as derivative products may be considered as high risk. Please ensure that you understand the risks involved. A Product Disclosure Statement can be obtained here and should be considered before trading with us.

Vishal Rathod

August 5, 2021

  • Reading time: 6mins
Share on facebook
Share on twitter
Share on linkedin

Related blog posts

Get weekly insights from award-winning team

Sign up for all the latest updates from our Rockfort Academy including news, industry analysis and updates from trading central team.

  * By entering your email, you agree to our Terms of Service and Privacy Policy.

Open a FREE CFD demo trading account

Rockfort Markets’ products are risky; please read our PDS.