Welcome traders and investors, to your weekly price update on bitcoin and gold.
At the time of writing, bitcoin is trading at $6,490. It has recently retreated from the $6,600 region, which it had been trying to break through over the past few days.
But despite stalling at this key level, the general market sentiment seems to have improved over the last week, and the price of bitcoin has risen 4 percent during this time.
Last Saturday (30th), Bitcoin broke upwards out of the narrow descending channel it had been trading in for past few weeks, bringing with it a new phase of bullish momentum.
This price movement has corresponded with some positive news, including a European Parliamentary hearing on virtual currency that voiced approval for the technology, citing its potential to deliver transactions that are “relatively safe, transparent, and fast”
Following the breakout, we saw a couple of days of consolidation—with the market ranging as buyers and sellers found agreement around the $6,344 level, before another bull flag breakout on Monday (2nd), further confirming the mini bull trend. Finally, bitcoin printed another long green candle as the Americans celebrated Independence Day, bringing the price right back up to strong historical resistance levels at $6,800.
Looking to the future, the sight of green has brought more confidence to the markets, and as we have convincingly scaled several levels of key technical resistance since last Friday, we could now be looking towards $7,000. However, this is a key psychological mark and is likely to require a significant boost in volume to break.
Should this short-term bullish momentum subside, then a downside target could be found at the $6,300 level.
Greenback Caps Gold Gains
After three consecutive losing weeks, which has seen the price of gold prices slip 3.5% against the strong U.S dollar, gold has steadied and is now managing to hold above the 100-hour SMA (shown in blue).
The escalating trade tensions of the past few weeks have weighed heavily on equity markets and prevented the traditional safe haven of gold from making any progress against the greenback.
On Monday, the market found a local bottom at $1,241 and rose to cap out on Wednesday with decreasing trading volume as the Americans celebrated Independence Day.
Yesterday, minutes were released from the Fed’s June FOMC meeting, which saw the Fed raise rates for the second time this year. The minutes were also hawkish, suggesting that future rate hikes are likely—which could cause some movement in the price of gold.
Looking to the future should trade discussions devolve into a full-blown trade war between the U.S. and China, nervous investors are likely to rush towards safe-haven assets like gold, causing this minor uptrend to continue where horizontal resistance could be faced at $1,267.
To the downside, a continued strengthening of the US dollar could push gold down to meet immediate support at the $1,252 level (100-hour SMA), and further down to $1,241, which would put the price in continuation with the trend of the past few weeks.
This analysis was published by bitcoin and gold exchange Vaultoro.
Disclaimer: This information is not a recommendation to buy or sell. It is to be used for educational purposes only.