Technical analyst Ross Burland says the gold price is poised for a potential short. Bears are waiting for a retest of $2,000 and below. Meanwhile, Bitcoin volatility has dwindled further this week. BTC bears are not letting the bulls pass, crypto analyst Rakesh Upadhyay said.
Money managers start taking gold positions
As you follow on Kriptokoin.com, the price of gold closed the week lower after an unexpectedly strong report on US Non-Farm Payrolls on Friday, the US created 253,000 new jobs in April, well beyond the consensus estimate of an increase of 180,000. The market now has to consider a scenario where the Federal Reserve has to step back from the anticipated pause in rate hikes. As a result, bond yields rose. Also, there was a decline for gold as it did not yield interest.
Ahead of the data, money managers once again began taking gold positions as continued stress in the banking industry simultaneously forced them to close short selling ahead of the Federal Open Market Committee and boosted confidence that the Fed was increasingly reaching ‘near terminal’ rates. TD Securities analysts make the following assessment:
The market began to smell a pause. This tends to lag the optional positions in the yellow metal. This marks a significant and sustained increase in gold position on the horizon, given that discretionary gold positioning has risen significantly more than its current levels in the last cycle of stall and cutoff.
Gold price technical analysis
The analyst first makes his assessment on the weekly gold charts.
Gold price weekly charts-1
Gold price weekly charts-2The wick in last week’s candle can be seen as an opportunity for next week to fill the wick.
Gold price daily charts-1The daily chart shows a number of key areas where the bullish thesis should hold. First, the bulls will need to stay ahead of the trendline supports. $2,000 and $1,970 are key in this regard.
Gold price daily charts-2However, the W-formation and strong selling on Friday are problematic. The bulls will need to stick to the aforementioned levels and the trendline support perimeter.
Gold, 4-hour chartFrom a 4-hour perspective, said support area looks vulnerable given the current formation of the chart unfolding before us. Should the correction begin to slow down in the highlighted potential resistance areas, the bears may be encouraged to seize the $1,970 to $1,990 support area. Therefore, the bias is bearish below $2,050 and below $2,030 in the near term.
BTC price analysis: Bears not letting bulls pass
Bitcoin fell sharply from the resistance line of the symmetrical triangle formation on May 6. This shows that the bears do not want to let the bulls pass. A minor positive development is that the bulls are buying dips towards the support line of the triangle, as seen by the long tail on the day’s candlestick.
BTC daily chart / Source: TradingViewThe 20-day exponential moving average ($28,819) is flat. Also, the relative strength index (RSI) is near the midpoint. This does not signal a clear advantage for either the bulls or the bears. A drop below the triangle will indicate that the bears are trying to take control. It is possible for BTC to drop to $26,942 and then to $25,250. On the other hand, a break and close above the triangle will indicate that the bulls are absorbing the supply. This is also likely to start a rally towards $32,400 where the bears are again expected to put up a strong defense.
BTC 4-hour chart / Source: TradingViewBuyers pushed the price above the triangle. However, the long wick on the candlestick indicates that the breakout has turned into a bull trap in the near term. BTC price declined sharply and declined to the support line of the triangle. The bounce from this level has reached the moving averages, which is an important short-term level to watch out for. If Bitcoin’s price turns down from the current level, it will increase the chances of a break below this support line. On the contrary, if the buyers push the price above the moving averages, BTC is likely to rise to the resistance line. The bulls will need to push and sustain the price above this level to initiate an upward move.
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