Bitcoin pops after drop under $30k

"Returns matter a lot. It's our capital." — Abigail Johnson

 

HEADLINES

•    Fed will not raise rates on inflation fears alone, Powell says
•    Dollar lower as Powell reaffirms pledge to not raise rates too quickly
•    GBP/USD bulls move to the highs as Powell testifies
•    Brent Crude Oil Cruises Past $75
•    XAU/USD consolidates in bearish territory
•    Nasdaq Closes at Record High as Tech Shines
•    Bitcoin rallies after dropping below $30,000 on China crackdown
•    AUD/USD: RBA tapering ahead of the Fed to propel the Aussie towards 0.85 – SocGen

 

Fed will not raise rates on inflation fears alone, Powell says

 

"We will not raise interest rates pre-emptively because we fear the possible onset of inflation. We will wait for evidence of actual inflation or other imbalances," Powell said in a hearing before a U.S. House of Representatives panel.

FOREX

 

Dollar lower as Powell reaffirms pledge to not raise rates too quickly

 

The U.S. dollar held at lower levels on Tuesday after Federal Reserve Chair Jerome Powell reaffirmed the U.S. central bank’s intent to encourage a “broad and inclusive” recovery of the job market, and not to raise interest rates too quickly based only on the fear of coming inflation.

 

GBP/USD bulls move to the highs as Powell testifies

At the start of the European session, sterling fell against a slightly stronger dollar as traders prepared for more hawkish rhetoric from the Federal Reserve's chair, Jerome Powell, who [was later] testifying to Congress.

Meanwhile, analysts expect no changes to policy after the Bank of England. The central bank announces its latest decision at 12:00 BST on Thursday 24 June. A more optimistic economic assessment from the Bank of England could push sterling back towards 1.4000. 

COMMODITIES

 

Brent Crude Oil Cruises Past $75

 

The global price of oil, measured by the U.K.’s benchmark Brent crude, cruised past $75 a barrel the first time in two years Tuesday as market participants awaited U.S. inventory data that could signal further supply tightening amid the approach of peak summer demand.

 

XAU/USD consolidates in bearish territory

 

Gold prices were lower into the closing bell on Tuesday but off their lows as the greenback lost ground in the latter part of New York day. 

Numerous Fed speakers dialled back the hawkish theme in comments on Wednesday. Cleveland Fed President Loretta Mester said that now is not the time to end accommodative policies while New York Fed President John Williams argued that there is still plenty to go until full employment.

STOCKS

 

Nasdaq Closes at Record High as Tech Shines

 

The Nasdaq closed at a record high Tuesday with big tech making strong gains as Federal Reserve Chairman Jerome Powell in testimony before Congress continued to downplay fears over the sharp pace of inflation. 

Powell largely stuck to his prepared remarks in testimony before a House select subcommittee hearing on the Fed’s pandemic response and the economy, reiterating the rapid pace of inflation will fade and job gains will pick up in the coming months.

CRYPTO

 

Bitcoin rallies after dropping below $30,000 on China crackdown

The earlier sell-off was sparked by the People’s Bank of China urging China’s largest banks and payment firms to crack down harder on cryptocurrency trading, the latest tightening of restrictions on the sector by Beijing.

ANALYSIS

 

 

AUD/USD: RBA tapering ahead of the Fed to propel the Aussie towards 0.85 – SocGen

 

“Regarding monetary policy, we expect the RBA to start implementing tapering in 2H, and the first cash rate hike in 2023. This implies that the bond purchase programme should end in 2022. In contrast, the Fed should announce a tapering program before the year-end, which we expect to begin in January 2022. 

 

The 10 yields differential is now almost flat, reflecting the AUD/USD range and the current monetary status quo. But earlier RBA tapering in the second part of the year should widen the yields spread and restart the AUD/USD bullish trend.”

 

CHART

 

Bitcoin – 1 hour Candlesticks

 

  
Source: GKFX Prime Metatrader 4 

A strong rally from underneath $30,000 with bullish RSI divergence has setup BTC/USD for a possible bullish breakout above resistance at $33,300. - Prepared by Trading Writers*

 

CALENDAR

 

 

*Times in GMT

 

 
Source: FX Street Economic Calendar

 

Source

 

https://www.fxstreet.com/economic-calendar
https://www.fxstreet.com/news/gbp-usd-bulls-move-to-the-highs-as-powell-testifies-202106221916
https://www.fxstreet.com/news/aud-usd-rba-tapering-ahead-of-the-fed-to-propel-the-aussie-towards-085-socgen-202106221351
https://www.investing.com/news/stock-market-news/nasdaq-closes-at-record-high-as-tech-shines-2539382
https://www.investing.com/news/commodities-news/brent-crude-oil-cruises-past-75-as-us-inventory-data-awaited-2539200
https://www.investing.com/news/economy/us-lawmakers-likely-to-press-powell-on-feds-hawkish-turn-2538587
https://www.reuters.com/article/global-forex/forex-dollar-lower-as-powell-reaffirms-pledge-to-not-raise-rates-too-quickly-idUSL2N2O42SL
https://www.fxstreet.com/news/gold-price-forecast-xau-usd-consolidates-in-bearish-territory-202106222034