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Daily Analysis: Risk-Off Day for Markets as Bitcoin Soars to New High

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Daily Analysis: Risk-Off Day for Markets as Bitcoin Soars to New High

Introduction

This article was posted on Tuesday, 16:00, UTC.

Tuesday Market Recap

Asset Current Value Daily Change
S&P 500 2430 -0.11%
DAX 12688 -1.04%
WTI Crude Oil 47.15 -0.42%
GOLD 1297.00 1.10%
Bitcoin 2822 8.93%
EUR/USD 1.1268 0.18%

Stock markets are trending lower today, although not much damage has been done so far, especially in the US indices, which are still very close to their all-time highs. Japanese and European stocks are down by around 1%, and the Nikkei plunged below the 20,000 level, while the DAX retreated from its recent highs. The negative global sentiment is partly the consequence of the Qatar tensions, while the uncertainty regarding the British election, and the continued decline in the price of oil added to the pressure.

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Gold is up substantially as it continues to march towards the $1300 level with now only a tad away from the crucial resistance, and its highs from November. The Japanese Yen is also riding the risk-off wave, and the USD/JPY pair fell below 110 for the first time since April, with the USD still being under selling pressure before next week’s Federal Reserve meeting. Bitcoin, the latest safe-haven asset (see our latest analysis) also got a boost overnight, as it blew through its all-time high and got close to the $3000 mark today.

USD/JPY 4-Hour Chart Analysis

Currency markets are quite volatile today, thanks to the strength of the Yen and the increased activity in the Pound before the election on Thursday. The Euro is still among the strongest majors, hovering around its 8-month highs against the Dollar, just below the 1.13 level, before the ECB’s monetary meeting that is also scheduled for Thursday. The Australian Dollar rose above 0.75 compared to the USD after the RBA’s rate decision and the central bank’s optimistic statement regarding the country’s economy.

Technical Picture

The S&P 500 is holding up well in today’s negative environment trading less than 0.5% off its previous all-time high near 2440. The short-term uptrend is still intact, although the under-the-hood weakness of the market is apparent, with financials still lagging the market substantially and only 64% of the stocks being above their 200-day moving averages— a very low ratio given the index’s position. That said, the benchmark is still on a short-term buy signal, above the crucial support/resistance level at 2417.

S&P 500, 4-Hour Chart Analysis

Key Economic Releases on Tuesday

Time, CET Country Release Actual Expected Previous
6:30 AUSTRALIA RBA Rate Decision 1.50% 1.50% 1.50%
6:30 AUSTRALIA RBA Statement
16:00 CANADA Ivey PMI 53.8 62 62.4

 

Key Economic Releases on Wednesday

Time, CET Country Release Expected Previous
6:30 AUSTRALIA GDP Growth 0.30% 1.10%
6:30 UK Halifax HPI -0.20% -0.10%
16:00 CANADA Building Permits 2.40% -5.80%

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Mate Cser

Mate Cser

Trader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.

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