Market Analysis

Pipscollector.com - Key Points:

• Bitcoin spot ETFs received $530.20 million of inflows on Monday.
• The US Government's and Mt. Gox funds movement on Monday may negatively impact Bitcoin's price.
• On-chain data shows that Bitcoin Exchange Depositing Addresses are decreasing, signaling growing confidence among investors. 

Bitcoin (BTC) struggles around the $67,000 mark and declines by 1.7% at the time of writing on Tuesday at around $66,350. Bitcoin spot ETFs saw significant inflows of $530.20 million on Monday. However, movements involving the US Government and Mt. Gox potentially exerted downward pressure on Bitcoin's price. Concurrently, on-chain data reveals a decrease in Bitcoin Exchange Depositing Addresses, indicating rising investor confidence in holding their assets.

Daily digest market movers: Bitcoin spot ETF received $530.20 million in inflows on Monday

• According to Coinglass Bitcoin Spot ETF data, inflows of $530.20 million occurred on Monday, the highest since June 5. Monitoring these ETFs' net flow data is crucial for understanding market dynamics and investor sentiment. The combined Bitcoin reserves held by the 11 US spot Bitcoin ETFs stand at $53.16 billion.

Total Bitcoin Spot ETF Net Inflow (USD) chart

• Data from Arkham Intelliengnce shows that Mt. Gox addresses deposited $1 to 4 separate Bitstamp deposit addresses. Bitstamp is 1 of 5 exchanges working with the Mt. Gox Trustee to facilitate creditor repayments. These transfers are likely to represent test transactions. Mt. Gox currently holds $6.08 billion in Bitcoin.
• Furthermore, data from Lookonchain reveals that the US Government transferred 58.74 BTC valued at $3.96 million to CoinbasePrime, increasing its total holdings to 213,239 BTC worth $14.42 billion. This unexpected transfer of funds may have triggered FUD (Fear, Uncertainty, Doubt) among traders, potentially contributing to Bitcoin's 1% price decline on Monday.
• Data from the CryptoQuant Bitcoin Exchange Depositing Addresses metric provides insights into the flow of Bitcoin into exchanges, which can be useful for understanding market dynamics and investor behavior.
• The decrease in deposit addresses to 25,000 signifies a pivotal signal suggesting a shift in Bitcoin holders' strategy. The reduction in addresses available for selling Bitcoin indicates a preference among investors to hold onto their assets, anticipating potential price appreciation. 
• This trend reflects growing confidence among Bitcoin investors, potentially influenced by factors such as increased institutional involvement in cryptocurrencies. Reduced selling activity could limit Bitcoin supply, potentially leading to price increases amid steady or rising demand. This development is bullish, signaling expectations of higher future values in the market.

Bitcoin Exchange Depositing Addresses chart

Technical analysis: BTC struggles around the $67,000 mark

Bitcoin’s price surpassed the weekly level of $67,209 on Sunday, halting its recent upward movement. As of Tuesday, BTC retraces and trades at around $66,350 at the time of writing.

If BTC continues to retrace, it could find support at the daily level of $64,913, coinciding closely with the 61.8% Fibonacci retracement level at $64,921, derived from the June 7 swing high of $71,997 on June 7 to the July 5 swing low of $53,475 on July 5, establishing a critical zone of support that should be monitored closely.

If this area of support at $64,913 holds, BTC could rally 11% to retest its June 7 daily high of $71,997.On the daily chart, the Relative Strength Index (RSI) and the Awesome Oscillator (AO) are trading above their respective neutral levels of 50 and zero, respectively. This robust momentum signals a strong bullish sentiment in the market.

BTC/USDT daily chart

However, a close below $56,405, accompanied by a formation of a lower low on the daily timeframe, could indicate sustained bearish sentiment. Such a scenario might precipitate a 7.5% decline in Bitcoin's price, potentially leading to its daily support level at $52,266.

Quote source: Fxstreet

Pipscollector.com - Key Points:

• The Gold price rebounds in Tuesday’s early European session. 
• Rising rates cut expectations and safe-haven flows might cap the precious metal’s downside.
• Pausing China's PBoC Gold purchases will likely weigh on XAU/USD in the near term. 

The Gold price (XAU/USD) gains momentum amid the weaker US Dollar (USD) during the early European session on Tuesday. The downside for the precious metal might be limited as traders raise their bets that the US Federal Reserve (Fed) would cut interest rates in September following soft US employment data last week. Additionally, the cautious mood amid the political uncertainties in France and geopolitical tensions in the Middle East might boost the Gold price, a traditional safe-haven asset.

Nonetheless, Gold prices might be dragged lower by the People Bank of China’s (PBoC) decision not to buy Gold for a second straight month in June. Gold traders will monitor Fed Chair Jerome Powell's semi-annual Congressional testimony, along with the speeches from Fed’s Michael Barr and Michelle Bowman. On Thursday, the US Consumer Price Index (CPI) inflation data will take center stage. 

Daily Digest Market Movers: Gold price remains strong amid rising Fed rate cut bets

• The Chinese central bank kept Gold buying on hold for the second month in June, according to official data released on Sunday.
• China, the world's largest gold consumer, kept its gold holdings unchanged for the second consecutive month in June, after 18 months of purchases. These figures indicated that its reserves remained at 72.8 million ounces, valued at roughly $170 billion.
• "This looks like a lot of profit taking, and the equities are strong, and this morning here, which kind of has a little bit of a competing factor with precious metals," said Bob Haberkorn, senior market strategist at RJO Futures.
• Financial markets have priced in a nearly 76% chance of a Fed rate cut in September, up from 71% last Friday, according to the CME FedWatch tool. 
• The US CPI inflation is expected to ease to 3.1% YoY in June from 3.3% in May, while core inflation is estimated to remain steady at 3.4% YoY in the same reported period.

Technical Analysis: Gold price’s bullish bias remains in the longer term

The gold price trades on a positive note on the day. The yellow metal sustains a breakout above a descending trend channel that formed on May 10. According to the daily chart, the precious metal maintains the bullish trend above the key 100-day Exponential Moving Average (EMA), with the 14-day Relative Strength Index (RSI) holding in the bullish zone above the 50-midline. This indicates that the support level is likely to hold rather than break. 

The $2,400 psychological level acts as an immediate resistance level for XAU/USD. The next upside barrier to watch is $2,432 (high of April 12) en route to $2,450 (the all-time high). 

In the bearish event, the first downside target will emerge at $2,340 (former resistance level). Any follow-through selling below this level will pave the way to $2,273 (100-day EMA). 

Quote source: Fxstreet.

Pipscollector.com - Key Points:

• Gold settled near the $2330 level despite rising Treasury yields.
• Silver is moving higher as gold/silver ratio pulled back below 79.50.
• Platinum tests support at $975 - $985.

Gold

Gold 010724 Daily Chart

Gold gains some ground despite rising Treasury yields. From a big picture point of view, gold found strong support near the $2300 level but needs additional positive catalysts to gain upside momentum.

If gold climbs above the 50 MA at $2337, it will move towards the nearest resistance at $2390 – $2400.

Silver

Silver 010724 Daily Chart

Silver continues to rebound from recent lows as gold/silver ratio pulled back below the 79.50 level.

In case silver manages to settle above the $30.00 level, it will move towards the resistance at $30.90 – $31.20.

Platinum

Platinum 010724 Daily Chart

Platinum  pulls back despite the encouraging Manufacturing PMI report from China, which showed that Manufacturing PMI increased from 51.7 in May to 51.8 in June.

A successful test of the support at $975 – $985 will open the way to the test of the next support level at $925 – $935.

For a look at all of today’s economic events, check out our economic calendar.

Quote source: Fxempire.

USD/JPY, YEN ANALYSIS

• FX intervention rhetoric shifts up a gear

• USD/JPY completely disregards the fall in US-Japan bond spreads to trade higher

• Markets appear to be calling the bluff of Japanese officials as each intervention level has been surpassed since 2022 interventions

• The analysis in this article makes use of chart patterns and key support and resistance levels. For more information visit our comprehensive education library

Japan’s top currency official Masato Kanda from the Ministry of Finance (MoF) issued his sternest warning yet against undesirable, speculative moves in the FX space. However, markets appear happy to call his bluff seeing that USD/JPY has moved effortlessly beyond prior levels where intervention took place.

Kanda mentioned he is seriously concerned about the recent rapid weakness of the yen which is getting closer to the 4% gauge relied upon previously to judge a ‘rapid’ and undesirable decline in the currency. Ahead of the April FX intervention, Kanda clarified a 4% depreciation over a two-week period or a 10% decline over a month meets the definition. Since the May swing low, the yen had depreciated around 3.15% in the space of two weeks, getting close to the 4% rule of thumb.

USD/JPY traded to an intra-day high (London session) at the time of writing at around 160.81 and has breached into oversold territory on the RSI.

USD/JPY Daily Chart

USD/JPY COMPLETELY IGNORES THE DROP IN US-JAPAN BOND SPREADS

Recent developments in Japan have led to Japanese Government bonds rising above the 1% mark again but USD/JPY found no relief, still trading near and above 160.00. The US-Japan bond spread typically guides USD/JPY as seen below, but the pair appears to have detached from the yield differential.

The BoJ failed to provide details around a much-anticipated tapering of its bond portfolio in its last meeting where it previously spoke of reducing purchases that have kept Tokyo’s borrowing costs low. However, the BoJ stated this will be available at the July meeting at the end of next month.

In the meantime, Friday could provide insight into the Bank’s bond buying appetite when the BoJ is scheduled to release its new bond buying schedule. A combination of a reduced schedule of bond purchases combined with a potentially lower PCE figure in the US could provide a slight reprieve for USD/JPY ahead of the weekend but that appears a tough ask given the recent reluctance to halt the ascent.

Recent Disconnect Between USD/JPY and US-Japan 10Y Bond Spreads (orange)

A DANGEROUS GAME OF BLUFF: MARKETS VS THE MINISTRY OF FINANCE

Markets appear to be calling the Ministry of Finance’s bluff, trading comfortably above 160.00 – the most recent level that prompted officials to sell tens of millions of dollars to fund massive yen purchases. Whatever transpires, this remains a pair with excessive potential volatility that can appear with no warning – underscoring the importance of prudent risk management. Prior intervention efforts attracted moves around 500 pips.

Prior, Surpassed Instances of FX Intervention

Quote source: Dailyfx.