Bitcoin Prices Poised for More Gains as Risk Assets Gain After Weak US GDP

Cryptocurrency could become digital gold, former US Treasury Secretary Lawrence Summers

A weak US second-quarter GDP print saw traders trim Fed rate hike bets as the threat of a recession weighs on the Fed’s calculus. That sent US stocks higher overnight on Wall Street, where the benchmark S&P 500 rose 1.21%. The two consecutive quarters of GDP decline put the US economy in a likely recession, although it is encouraging that the rate of contraction eased in Q2.

The US Dollar fell as traders moved into Treasuries, especially on the short-end of the curve. That pushed yields lower, dragging on the US Dollar. The DXY index fell to its lowest level since July 05. The Japanese Yen was a big gainer against the USD. USD/JPY fell to its lowest level since June 17, dropping almost 2% during New York trading.

See Also:  Gas stimulus check: Is your state considering a gas rebate?

The Japanese Yen may see more movement today on the release of several Japanese data prints. Japan’s June unemployment rate is slated to cross the wires, followed by July CPI figures for Tokyo. Later today, the Bank of Japan’s summary of opinions, June industrial production data, and June retail sales are due out. The data dump may help traders gauge where the BoJ’s head is.

WTI crude oil prices fell, while Brent crude prices rose. The weak GDP print likely explains some of the softness in the US prices. The WTI prompt spread and the 1:1 RBOB/CL crack spread, both gauges of demand for oil and gasoline have traded lower over the past week. That signals the potential for more weakness in the near term. However, WTI’s discount to Brent crude prices is likely encouraging demand through exports on WTI, which could keep prices elevated.

See Also:  Social Security Administration's December Double Payment: Unraveling the Reasons

Consumer confidence in New Zealand rose in July, according to ANZ. The Kiwi Dollar gained nearly 0.5% against the USD overnight. The Australian Dollar was little changed despite higher iron ore prices in China. AUD/USD may rebound today if Australia’s second-quarter producer price index shows that factory-gate prices increased from Q1.

BTC/USD continued its run higher after crossing above a key level of resistance in place since early June following a break above the 50-day Simple Moving Average and a descending trendline from March. The 100-day SMA and a level of prior support from May is the next target for the cryptocurrency. The RSI and MACD oscillators are both tracking higher above their respective midpoints.



Aishwarya Ramaning
About Aishwarya Ramaning 194 Articles
Aishwarya Ramaning, a woman who stands strong, when it comes to the woman's right. She is an autodidactic person, who chooses not to be a silent follower, but an egalitarian from the heart who has sustained the cold winds in rooting her career. Believes a pen could succeed, where a stick or a stomp might have failed. Having a soul of solicitude and a Humanitarian moralist is keenly looking forward to becoming an adept news writer and a legal practitioner.

Be the first to comment

Leave a Reply

Your email address will not be published.