#Crypto market capitalisation rose 5.2% over the past seven days to $2.41 trillion. Over the weekend, it reached $2.44 trillion, its highest level in nearly four weeks.
#Bitcoin is treading near local highs, remaining just below $67K. That's a gain of 8.4% in seven days and a retest of the previous peak area in late April. Despite the burgeoning risk appetite in global markets, demand for Bitcoin, Ethereum and many altcoins is rather subdued. However, BTCUSD remains firmly above the 50-day moving average, indicating an upward trend.
Investors are more optimistic about #Solana, whose price rose to its highest since early April at $177 (+1.5% in 24h). It may well reach the March highs before Bitcoin, acting as a more sensitive indicator of risk appetite in cryptocurrencies.
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#Bitcoin is treading near local highs, remaining just below $67K. That's a gain of 8.4% in seven days and a retest of the previous peak area in late April. Despite the burgeoning risk appetite in global markets, demand for Bitcoin, Ethereum and many altcoins is rather subdued. However, BTCUSD remains firmly above the 50-day moving average, indicating an upward trend.
Investors are more optimistic about #Solana, whose price rose to its highest since early April at $177 (+1.5% in 24h). It may well reach the March highs before Bitcoin, acting as a more sensitive indicator of risk appetite in cryptocurrencies.
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Oil is losing about 0.75% of its peak on Monday, having hit a strengthening sell-off as it attempts to climb above $80 for #WTI and $84 for #Brent.
Oil is declining despite the death of Iran's president, which should reinforce the risk premium, and despite a strong rally in metals and other commodities in response to China's stimulus measures.
News on the US oil industry points to relative stagnation. According to Friday's report from Baker Hughes, the total number of Oil rigs in the US was 497 compared to 496 and 499 in the last two weeks. We have been seeing fluctuations around the 500 level since last October.
The official weekly report from the US Energy Information Administration last week also pointed to stagnant production at 13.1 million bpd over the last ten weeks. This volume also is the average over the period since mid-September.
The conclusion is that current prices are neutral for the industry, not creating incentives to increase production but not causing it to decline either.
Oil is declining despite the death of Iran's president, which should reinforce the risk premium, and despite a strong rally in metals and other commodities in response to China's stimulus measures.
News on the US oil industry points to relative stagnation. According to Friday's report from Baker Hughes, the total number of Oil rigs in the US was 497 compared to 496 and 499 in the last two weeks. We have been seeing fluctuations around the 500 level since last October.
The official weekly report from the US Energy Information Administration last week also pointed to stagnant production at 13.1 million bpd over the last ten weeks. This volume also is the average over the period since mid-September.
The conclusion is that current prices are neutral for the industry, not creating incentives to increase production but not causing it to decline either.
The price chart shows a balance of power for more than two weeks now. Since December, the price has been moving in an ascending channel. Oil briefly fell out of this range last week but found buyers rising from $76.4 to $79.8 in less than three days.
The bulls are also not yet able to unequivocally retake the lead, as an attempt to exceed the 200-day moving average on Monday was met with increased selling. This may be a signal that the bears are still in control of the situation and are now gathering strength for a new downward impulse. We will get confirmation of this hypothesis only in case of consolidation under $76.5. It is also relatively easy for oil to roll back to $75, where the 200-week moving average lies. However, a failure below $70-$71 could start a real corkscrew in oil with a potential first target at $50 and a final target at $30.
The ability to get back above $80 would be a sign of a bullish recovery and set the mood for a quick exit to $85 within weeks and above $92 by mid-summer.
The bulls are also not yet able to unequivocally retake the lead, as an attempt to exceed the 200-day moving average on Monday was met with increased selling. This may be a signal that the bears are still in control of the situation and are now gathering strength for a new downward impulse. We will get confirmation of this hypothesis only in case of consolidation under $76.5. It is also relatively easy for oil to roll back to $75, where the 200-week moving average lies. However, a failure below $70-$71 could start a real corkscrew in oil with a potential first target at $50 and a final target at $30.
The ability to get back above $80 would be a sign of a bullish recovery and set the mood for a quick exit to $85 within weeks and above $92 by mid-summer.
The crypto market cap has stabilised at $2.6 trillion. Among the top coins over 24 hours, Toncoin is down 5%, leading the decline, while Dogecoin is up 3.4%.
#Bitcoin is losing 1.9% in 24 hours to just below $70K, having come under pressure after it rallied above $71.3K, as short-term speculators rush to take profits around the all-time highs reached in March. The local highs are just below the peaks in April and March, and now all eyes are on the market's next move. A break of resistance at $72K has the potential to trigger a real FOMO. A pullback below would force a $60K correction scenario to be considered as the main one.
#Ethereum has rallied around 22% since Monday evening, surpassing $3800. Technically, we got a signal of a powerful spurt above the 50-day moving average, meaning a return to the bull trend. Short-term, Ethereum has a clear path to $4000, the March peak, after which the bulls can target $4600. Now is the time when Bitcoin's next move depends on Ethereum.
#Bitcoin is losing 1.9% in 24 hours to just below $70K, having come under pressure after it rallied above $71.3K, as short-term speculators rush to take profits around the all-time highs reached in March. The local highs are just below the peaks in April and March, and now all eyes are on the market's next move. A break of resistance at $72K has the potential to trigger a real FOMO. A pullback below would force a $60K correction scenario to be considered as the main one.
#Ethereum has rallied around 22% since Monday evening, surpassing $3800. Technically, we got a signal of a powerful spurt above the 50-day moving average, meaning a return to the bull trend. Short-term, Ethereum has a clear path to $4000, the March peak, after which the bulls can target $4600. Now is the time when Bitcoin's next move depends on Ethereum.
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UK Inflation distanced the expected rate cut
Inflation in the UK exceeded forecasts, making traders and investors cautious about the prospects for policy easing in the coming months.
Consumer prices rose by 0.3% m/m vs. 0.2% expected. Annual inflation slowed to 2.3% last month from 3.2% in March. This is the lowest level in two years, comfortably close to the Bank of England's target but above the forecast of 2.3%.
Core inflation has been gently slowing over the past 12 months but has only fallen to 3.9% y/y from a peak of 7.1% y/y. Meaningful progress, but quite far from the desired level. In our view, the high growth rate of the core price index is the most important factor pushing forward the date of policy easing.
Inflation in the UK exceeded forecasts, making traders and investors cautious about the prospects for policy easing in the coming months.
Consumer prices rose by 0.3% m/m vs. 0.2% expected. Annual inflation slowed to 2.3% last month from 3.2% in March. This is the lowest level in two years, comfortably close to the Bank of England's target but above the forecast of 2.3%.
Core inflation has been gently slowing over the past 12 months but has only fallen to 3.9% y/y from a peak of 7.1% y/y. Meaningful progress, but quite far from the desired level. In our view, the high growth rate of the core price index is the most important factor pushing forward the date of policy easing.
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At the same time, producer prices have been at comfortably low levels for an extended period. The Input Producer Price Index loses 1.5% y/y, having remained in negative territory for the past 11 months. The Output Producer Price Index is rising at a rate of 1.1% y/y, accelerating over the past three months from a low of -0.2% in February.
Nevertheless, this is a relatively low rate that does not prevent policy easing.
Thus, the most intense inflationary pressure is centred on the retailers' stage. This is probably the result of rising labour costs or an attempt to compensate for narrow margins in previous years.
Nevertheless, this is a relatively low rate that does not prevent policy easing.
Thus, the most intense inflationary pressure is centred on the retailers' stage. This is probably the result of rising labour costs or an attempt to compensate for narrow margins in previous years.
The persistence of inflation translating into tighter monetary policy is causing pressure on the UK equity market. The FTSE100 is losing around 0.75%, smoothly forming a peak during the previous week. Inflation data looks like a worthwhile reason to start a correction that could take the index back to 8200 or even 8000 from the current 8360 before we see buying activity.
At the same time, this is good news for the pound, which hit a 2-month high against the dollar, rising above 1.2750 shortly after publication. This is an important area of resistance for the past 11 months.
A further continuation of inflation higher than G10 currencies has the potential to lift GBPUSD to the next leg up to the 1.30-1.40 area. Should the economy stumble, and with it inflation, this would remove the divergence in monetary policy and put pressure back on the pound, leaving it in the 1.20-1.27 range.
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At the same time, this is good news for the pound, which hit a 2-month high against the dollar, rising above 1.2750 shortly after publication. This is an important area of resistance for the past 11 months.
A further continuation of inflation higher than G10 currencies has the potential to lift GBPUSD to the next leg up to the 1.30-1.40 area. Should the economy stumble, and with it inflation, this would remove the divergence in monetary policy and put pressure back on the pound, leaving it in the 1.20-1.27 range.
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#WaveAnalysis
#AUDJPY reversed from resistance level 104.50
Likely to fall to support level 103.00
AUDJPY currency pair recently reversed down from the key resistance level 104.50, which stopped the previous sharp upward impulse wave 3.
The price formed two consecutive Japanese candlesticks reversal patterns Doji – signalling the strength of this resistance level.
Given the strength of the resistance level 104.50 and the overbought daily Stochastic, AUDJPY currency pair can be expected to fall further to the next support level 103.00.
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#AUDJPY reversed from resistance level 104.50
Likely to fall to support level 103.00
AUDJPY currency pair recently reversed down from the key resistance level 104.50, which stopped the previous sharp upward impulse wave 3.
The price formed two consecutive Japanese candlesticks reversal patterns Doji – signalling the strength of this resistance level.
Given the strength of the resistance level 104.50 and the overbought daily Stochastic, AUDJPY currency pair can be expected to fall further to the next support level 103.00.
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#WaveAnalysis
#USDCAD reversed from pivotal support level 1.3585
Likely to rise to resistance level 1.3750
USDCAD currency pair recently reversed up from the pivotal support level 1.3585 (former strong resistance from December, February and March) intersecting with the lower daily Bollinger Band and the 38.2% Fibonacci correction of the upward impulse from December.
The upward reversal from the support level 1.3585 stopped the previous minor ABC correction 2.
Given the strength of the support level 1.3585, USDCAD currency pair can be expected to rise further to the next resistance level 1.3750.
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#USDCAD reversed from pivotal support level 1.3585
Likely to rise to resistance level 1.3750
USDCAD currency pair recently reversed up from the pivotal support level 1.3585 (former strong resistance from December, February and March) intersecting with the lower daily Bollinger Band and the 38.2% Fibonacci correction of the upward impulse from December.
The upward reversal from the support level 1.3585 stopped the previous minor ABC correction 2.
Given the strength of the support level 1.3585, USDCAD currency pair can be expected to rise further to the next resistance level 1.3750.
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The #crypto market is quiet, hovering around a total capitalisation of $2.6 trillion for the third day. Bitcoin has so far failed to gain a foothold above $70K, and this is curbing the enthusiasm. It is losing 0.3% in 24 hours against Ethereum's 0.6% rise.
The top altcoins have comparatively subdued and varied dynamics, with fluctuations between -2% for #Dogecoin, -1.5% for #Solana and a 1.5% rise for #Toncoin.
Technically, #Bitcoin remains near the upper boundary of the descending range. The round level of $70K is also quite important for the young crypto market. Going higher would break two barriers at once. Short-term growth momentum could quickly take the price to the highs at $73.5K.
A more distant and important target could be in the $95K-$100K area, where the lower boundary is the 161.8% level of the January-March rise and the upper boundary is an important round level.
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The top altcoins have comparatively subdued and varied dynamics, with fluctuations between -2% for #Dogecoin, -1.5% for #Solana and a 1.5% rise for #Toncoin.
Technically, #Bitcoin remains near the upper boundary of the descending range. The round level of $70K is also quite important for the young crypto market. Going higher would break two barriers at once. Short-term growth momentum could quickly take the price to the highs at $73.5K.
A more distant and important target could be in the $95K-$100K area, where the lower boundary is the 161.8% level of the January-March rise and the upper boundary is an important round level.
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Upbeat PMIs brought buyers back into the Euro
Preliminary estimates of European business activity indices noted an overall acceleration in the Eurozone economy better than expected, helping the Euro find temporary support as it approaches 1.08.
Germany provided the biggest upside to expectations this time around after months of negative surprises. The manufacturing PMI rose from 42.5 to 45.4 vs. the forecast of 43.2. This is still in contraction territory (below 50), but the trend is clearly positive.
Germany's service sector is strengthening its expansion, as reflected in the rise in the corresponding PMI to 53.9, the highest since last June. This is a territory of healthy growth and where the index was from 2013 to 2019.
Germany's composite PMI is only on the cusp of normal levels due to weakness in manufacturing, but the positive trend is building optimism.
Preliminary estimates of European business activity indices noted an overall acceleration in the Eurozone economy better than expected, helping the Euro find temporary support as it approaches 1.08.
Germany provided the biggest upside to expectations this time around after months of negative surprises. The manufacturing PMI rose from 42.5 to 45.4 vs. the forecast of 43.2. This is still in contraction territory (below 50), but the trend is clearly positive.
Germany's service sector is strengthening its expansion, as reflected in the rise in the corresponding PMI to 53.9, the highest since last June. This is a territory of healthy growth and where the index was from 2013 to 2019.
Germany's composite PMI is only on the cusp of normal levels due to weakness in manufacturing, but the positive trend is building optimism.
It is not unusual for PMI releases to have a meaningful impact on the performance of the Euro or the region's stock indices. Today's release was no exception, and #EURUSD reversed to the upside after drifting downward for a week. However, the pair's loss of about a hundred points during this time looks like a correction after the acceleration since the beginning of the month.
Whether this is the case will be clear in case of consolidation above 1.09. A rise above the previous peaks will confirm the bullish trend, opening the way to 1.11 or higher.
We see an additional positive signal in the fact that EURUSD has received active support from buyers above the 1.0770-1.0780 area, where the 50- and 200-day moving average, as well as the former resistance line of the ascending channel, are located.
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Whether this is the case will be clear in case of consolidation above 1.09. A rise above the previous peaks will confirm the bullish trend, opening the way to 1.11 or higher.
We see an additional positive signal in the fact that EURUSD has received active support from buyers above the 1.0770-1.0780 area, where the 50- and 200-day moving average, as well as the former resistance line of the ascending channel, are located.
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#WaveAnalysis
#NASDAQ100 Index reversed from round resistance level 19000.00
Likely to fall to support level 18500.00
NASDAQ 100 Index today reversed down from the resistance area located between the round resistance level 19000.00 and the upper daily Bollinger Band.
The resistance level 19000.00 was strengthened by the resistance trendline of the daily up channel from the end of April.
Given the strength of the resistance level 19000.00 and the overbought daily Stochastic, NASDAQ 100 Index can be expected to fall further to the next support level 18500.00.
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#NASDAQ100 Index reversed from round resistance level 19000.00
Likely to fall to support level 18500.00
NASDAQ 100 Index today reversed down from the resistance area located between the round resistance level 19000.00 and the upper daily Bollinger Band.
The resistance level 19000.00 was strengthened by the resistance trendline of the daily up channel from the end of April.
Given the strength of the resistance level 19000.00 and the overbought daily Stochastic, NASDAQ 100 Index can be expected to fall further to the next support level 18500.00.
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#WaveAnalysis
#EURGBP reversed from long-term support level 0.8500
Likely to test resistance level 0.8550
EURGBP currency pair today reversed up from the major long-term support level 0.8500 (which has been steadily reversing all downward impulse of this pair from July of 2023) intersecting with the lower daily Bollinger Band.
The upward reversal from the support level 0.8500 stopped the previous impulse waves 3 and (3).
Given the strength of the support level 0.8500 and the oversold daily Stochastic, EURGBP currency pair can be expected to rise further to the next resistance level 0.8550.
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#EURGBP reversed from long-term support level 0.8500
Likely to test resistance level 0.8550
EURGBP currency pair today reversed up from the major long-term support level 0.8500 (which has been steadily reversing all downward impulse of this pair from July of 2023) intersecting with the lower daily Bollinger Band.
The upward reversal from the support level 0.8500 stopped the previous impulse waves 3 and (3).
Given the strength of the support level 0.8500 and the oversold daily Stochastic, EURGBP currency pair can be expected to rise further to the next resistance level 0.8550.
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The #crypto market lost 2.9% in the last 24 hours, retreating to a market capitalisation of $2.5 trillion. The market came under pressure as active trading began in the US on a fresh batch of strong economic data. News of the approval of spot ETFs on Ethereum only added to the pressure.
#Ethereum's sell-off on positive news is a typical "buy the rumours, sell the facts" reaction of speculators. We saw the same in January after the approval of the Bitcoin ETF, which took 19% off its price in the following two weeks before there was a spectacular reversal.
Similarly, the market may let off steam regarding Ethereum. We shouldn't be surprised if the price pulls back to the $3000 area again, returning to an important consolidation area. From these levels, large institutional investors can start building a position in ETFs.
#Ethereum's sell-off on positive news is a typical "buy the rumours, sell the facts" reaction of speculators. We saw the same in January after the approval of the Bitcoin ETF, which took 19% off its price in the following two weeks before there was a spectacular reversal.
Similarly, the market may let off steam regarding Ethereum. We shouldn't be surprised if the price pulls back to the $3000 area again, returning to an important consolidation area. From these levels, large institutional investors can start building a position in ETFs.
#Nasdaq100: not yet a correction
The Nasdaq100 index was once again the main driver of growth in US indices in May, indirectly also positively influencing markets elsewhere. On Thursday, the index was approaching the 19,000 level, adding over 11% to the 19 April lows. An impressive wave of selloffs hit the market, taking 2% off the index from peak to bottom. And now, the legitimate question is, are we seeing the beginning of a long correction?
Technically, the Nasdaq100 index is at the threshold of the overbought zone on RSI on daily timeframes. Contrary to the name, entering this area is more likely to see the most intense growth, although the least unpredictable.
Buyers' interest is supported by the fact that the index is now only 1% above the previous peak. After that peak, there was already an April correction that removed much of the market's short-term overheating.
The Nasdaq100 index was once again the main driver of growth in US indices in May, indirectly also positively influencing markets elsewhere. On Thursday, the index was approaching the 19,000 level, adding over 11% to the 19 April lows. An impressive wave of selloffs hit the market, taking 2% off the index from peak to bottom. And now, the legitimate question is, are we seeing the beginning of a long correction?
Technically, the Nasdaq100 index is at the threshold of the overbought zone on RSI on daily timeframes. Contrary to the name, entering this area is more likely to see the most intense growth, although the least unpredictable.
Buyers' interest is supported by the fact that the index is now only 1% above the previous peak. After that peak, there was already an April correction that removed much of the market's short-term overheating.
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The correction in July-October last year fits into a classic Fibonacci pattern, bringing the Nasdaq100 index close to 61.8% of the original rally and one hair away from the 200-day moving average. This should classically be followed by a rally to 161.8%, around 19200.
So, the Nasdaq100 is a little short of an important resistance area. But it is quite possible that it simply pauses to consolidate forces before a new leap upwards.
However, without a dramatic change in sentiment or a dramatic deterioration of economic data, we should not expect a steady decline in equity indices. The last downward impulse was short-term profit-taking provoked by a new batch of strong macroeconomic data. They suggest tighter monetary policy, but that is not a sufficient reason to start a bear market in equities.
Still, it is worth noting that a drop below the previous consolidation at the top near 18300 could be an important technical signal of a trend reversal.
So, the Nasdaq100 is a little short of an important resistance area. But it is quite possible that it simply pauses to consolidate forces before a new leap upwards.
However, without a dramatic change in sentiment or a dramatic deterioration of economic data, we should not expect a steady decline in equity indices. The last downward impulse was short-term profit-taking provoked by a new batch of strong macroeconomic data. They suggest tighter monetary policy, but that is not a sufficient reason to start a bear market in equities.
Still, it is worth noting that a drop below the previous consolidation at the top near 18300 could be an important technical signal of a trend reversal.
#WaveAnalysis
#Brent Crude oil reversed from strong support level 81.00
Likely to rise to resistance level 84.3
Brent Crude oil recently reversed up from the support area located between the strong support level 81.00, which has been reversing the price from February, and the lower daily Bollinger Band.
The support level 81.00 was strengthened by the nearby lower daily Bollinger Band and by the 61.8% Fibonacci correction of the upward impulse 1 from December.
Given the bullish divergence on the daily Stochastic, Brent Crude oil can be expected to rise further to the next resistance level 84.30.
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#Brent Crude oil reversed from strong support level 81.00
Likely to rise to resistance level 84.3
Brent Crude oil recently reversed up from the support area located between the strong support level 81.00, which has been reversing the price from February, and the lower daily Bollinger Band.
The support level 81.00 was strengthened by the nearby lower daily Bollinger Band and by the 61.8% Fibonacci correction of the upward impulse 1 from December.
Given the bullish divergence on the daily Stochastic, Brent Crude oil can be expected to rise further to the next resistance level 84.30.
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