Weekly Price Analysis #22 – Week 39

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Welcome bitcoiners and goldbugs, to your weekly price update!

BTC/USD – Bitcoin Pushes Into the Green

At the time of writing, BTC is trading at $6,776. The leading cryptocurrency is up nearly 3% in the past 24 hours.

However, despite this surge in bullish momentum, the price remains within the support and resistance channel that has framed all price action within recent weeks, and there is still reason to be cautious.

Volatility—as indicated by the Bollinger Bands—hit a yearly low mid-week, suggesting that a big move was approaching. As if by magic, the market delivered a minor pump very early on Friday morning(UTC), and now continues in an upward trend towards the top of the parallel channel.

This move was accompanied by some positive news—specifically the partial reversal of Google’s ad ban for cryptocurrency exchanges advertising in the U.S. and Japan.

If the price continues upward, then every positive move will bring it closer that top diagonal trend line that has acted as resistance over the past few months. Should it break, then a larger upward move could come into play. This bullish scenario is supported by the daily RSI, which shows strength building in the market.

If on the other hand bitcoin begins to fall, the first support could be found around $6550, after which the $6100 area—which has been repeatedly tested—would come into play.

XAU/USD – Gold Drops out of Range

Gold is currently changing hands for $1182. Over the last 24 hours, the yellow metal has dropped out of the narrow range it has been trading in over the past few weeks.

The descent began on Tuesday as Trump reasserted his administration’s tough stance on trade at the United Nations General Assembly. Then, on Wednesday, price continued to fall as the U.S. Federal reserve rates hiked for the third time this year in response to continued strong economic growth.

This boosted the dollar and in turn cast a shadow on gold, which—as it is priced in dollars— became more expensive for buyers outside the US.

Given the tight range which gold was trading in prior to this downwards break, it seems likely that it could lead to a significant drop, and if support around the $1183 area fails to hold, then the next support would be around $1173. Such a strong move down would signal a resumption of the down-trend that began in April this year.

If the dollar continues to rise, supported by expectations of higher interest rates, booming U.S. economy, and a weaker Euro, then we could reasonably expect this bearish scenario to play out.

Should price action reverse to form an upward break, then it would be likely to find immediate resistance at the top of the channel around $1208.

Disclaimer: This information is not financial advice, and should not be treated as a recommendation to buy or sell. It is to be used for educational purposes only.

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