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According to the BTC/USD chart, Bitcoin's price reached $68,000 in mid-October, a level not seen since late July. Can this upward momentum continue?

Jeff Kendrick, head of digital asset research at Standard Chartered Bank, predicts that Bitcoin could rise to $73,800 before the US presidential elections in November, which would mark a new all-time high.

Kendrick highlights several factors that may drive Bitcoin's price higher:

→ Less stringent regulation: A more favourable regulatory environment, as indicated by recent news regarding BNY Mellon's accounting practices, could benefit Bitcoin's price.

→ MicroStrategy's ambitions: The company plans to transform into a "Bitcoin bank," potentially enabling it to generate revenue by lending cryptocurrency in the future.

Today's technical analysis of the BTC/USD chart reveals:

→ The price is forming a long-term upward channel (shown in blue).

→ Since March, price fluctuations have created a downward channel (shown in purple), which may be seen as an interim correction within the main bullish trend. Technical analysts might refer to this as a "bullish flag" pattern.

→ A significant price increase on October 14 led to the formation of a bullish Fair Value Gap (FVG), indicating buyer dominance over sellers.

Given these factors, it is reasonable to expect that the $63,000 to $65,000 range could serve as a launchpad for bulls aiming to break through the multi-month resistance represented by the upper boundary of the purple corrective channel.

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Market Picture

The cryptocurrency market remains steady at around $2.31 trillion in market capitalisation, mirroring the local highs of late September, while Bitcoin continues to climb. The pause in overall growth has led to a 2-point dip in the Cryptocurrency Market Sentiment Index, now at 71—still reflecting a high level of greed.

Bitcoin is currently at $67.1K, showing a 0.5% increase over the past 24 hours but a slight 0.5% decline since the day’s opening. These minor fluctuations largely mirror the stabilisation seen in stock indices. This pause benefits the Bitcoin bulls, allowing the market to cool off after the recent rally.

The upcoming ECB interest rate decisions and US retail sales figures, set to be released just before the US session begins, could potentially disrupt the market’s current stability.

News Background

Tesla has transferred its entire 11,509 BTC holdings, valued at approximately $760 million, to unknown addresses, as reported by Arkham Intelligence. Meanwhile, SpaceX, also owned by Elon Musk, continues to hold 8,285 BTC in Coinbase’s Prime Custody wallet service.

Since Bitcoin reached new highs in March, the gap between demand and ‘active supply’ has widened, a trend that Glassnode notes is historically a precursor to periods of heightened volatility.

According to its issuer, Tether, at the end of the third quarter of 2024, the USDT stablecoin was used by 330 million cryptocurrency wallets and on-chain accounts. The company compared the figure to the US population and attributed the increase in users to second-tier solutions and the development of the TON ecosystem.

The Kenya Revenue Authority is introducing a new control system that will integrate with cryptocurrency exchanges. This system will enable real-time tracking of crypto transactions to ensure timely tax collection.

Eurozone goods exports fell -2.4% yoy to EUR 216.7B in August. Goods imports fell -2.3% yoy to EUR 212.1B. Trade balance was a EUR 4.6B surplus. Intra- Eurozone trade fell -4.3% yoy to EUR 183.5B.

In seasonally adjusted term, goods exports fell -0.1% mom to EUR 237.9B. Goods imports rose 1.0% mom to EUR 226.8B. Trade balance reported EUR 11.0B surplus. Intra-Eurozone trade fell -0.5% mom to EUR 215.1B.

Full Eurozone trade balance release here.

Eurozone CPI in September was finalized at 1.7% yoy, down from August’s 2.2% yoy. Core CPI, which excludes volatile components like energy, food, alcohol, and tobacco, was finalized at 2.7% yoy, slightly lower than August’s 2.8% yoy.

The largest contributor to Eurozone CPI was the services sector, adding +1.76 percentage points to the annual rate, followed by food, alcohol, and tobacco (+0.47 pp). Non-energy industrial goods added +0.12 pp, while energy dragged inflation down by -0.60 pp as prices continued to ease.

On a broader level, EU inflation was also finalized lower at 2.1%, down from 2.4% in August. Inflation rates across member states varied significantly, with the lowest annual rates recorded in Ireland (0.0%), Lithuania (0.4%), and Slovenia and Italy (both at 0.7%).

In contrast, Romania (4.8%), Belgium (4.3%), and Poland (4.2%) registered the highest inflation rates. Compared to August, annual inflation fell in twenty Member States, remained stable in two, and rose in five.

Full Eurozone CPI final release here.

The euro fell to the lowest in 2 ½ months in early European trading on Thursday, holding firmly in red for the fourth straight day, a part of larger three-week downtrend.

Markets await the ECB’s policy decision, due later today, with wide expectations that the central bank will deliver the third rate cut this year.

The ECB is likely to cut interest rates by 25 basis points today (Deposit rate to move to 3.25% from 3.50%) as inflation is under control and the economy is stagnating, partially due to high borrowing cost.

Markets also expect the ECB to cut rates three more times until March 2025, though confirmation for such action is unlikely to be heard from President Lagarde and other policymakers, as they stick to their mantra that any policy decision will be based on economic data ahead of every meeting.

Bearish picture on daily chart (strong negative momentum / Wednesday’s close below 200DMA / 10/100 bear-cross) and weakening weekly studies (14-w momentum indicator is breaking into negative zone / 5/200WMA death cross) support bearish scenario.

Bears eye immediate targets at 1.0835 Fibo 61.8% of 1.0601/1.1214) and 1.0809/00 (weekly cloud base / psychological), ahead of 1.0775 (Aug 1 higher low) and 1.0745 (Fibo 76.4%).

Broken 200DMA reverted to initial resistance (1.0872), followed by falling daily Tenkan-sen (1.0922) and the base of thick daily Ichimoku cloud (1.0968) which should cap corrective upticks to keep larger bears in play.

Res: 1.0872; 1.0907; 1.0935; 1.0968.
Sup: 1.0825; 1.0800; 1.0775; 1.0745.

Markets

Core bonds eked out some gains yesterday ahead of the ECB meeting and US data including retail sales and jobless claims scheduled for release today. Bunds outperformed Treasuries with yields losing around 4 bps across the curve. US yields lost between -0.8 (2-yr) and -2.4 bps (30-yr). Gilts rallied after September CPI decelerated more than expected. Even with underlying gauges still well above 2%, front-end yields in the UK tanked more than 11 bps as markets stacked up monetary easing bets. Sterling slipped but managed to claw back some of the losses against an overall weak euro as trading evolved. EUR/GBP rose from 0.833 to 0.836. Cable (GBP/USD) lost the 1.30 big figure (July interim high, September correction low & 38.2% retracement on the April-Sep 2024 rise). We don’t want to call it a formal technical break lower just yet. The pair may still rebound towards 1.32 to finish a developing head-and-shoulders pattern. The US dollar held the upper hand against all peers but CAD. DXY took out 103.34 (50% recovery on the YtD high to low). EUR/USD dropped further below 1.09 and closed in on intermediate support around 1.0835. The bottom of the bearish August-October double top formation is located around 1.08. The ECB is expected to cut rates by 25 bps to 3.25%. That’s a complete U-turn since ECB chair Lagarde basically ruled that out in September because of the short inter-meeting period. Ongoing disinflation and especially weak PMIs made many policymakers, led by Lagarde’s example, change tack. That’s data-dependency to the fullest – an argument we expect Lagarde to use to defend today’s decision. For that same reason she’s unable to offer much guidance for December, given there are two PMI’s, two CPI’s and Q3 wage data. That’s a recipe for volatility: markets currently expect 100 bps of cuts over the next four meetings (today included). Meanwhile inflation numbers are all but certain to pick up again in the coming months. One less dire PMI outcome and things may shift drastically. For the time being though, we hold on to our short-term target for EUR/USD around 1.08 amid ongoing (technical) USD strength. Front-end European yields discount enough rate cuts in our view, suggesting the recent October lows (around 2% for the German 2-yr, 2.2% for the swap equivalent) are a solid bottom.

News & Views

Data published by the Australian Bureau of Statistics this morning showed that the labour market remains strong. The economy added a net 64.1 k of jobs in September, up from 42.6 k in August. The rise was mainly due to a jump in full-time employment (+51.6k compared to a small decline of -5.9k in August). Measured by the overall change in employment, it was the sixth straight month that employment growth beat expectations. The unemployment rate was unchanged at 4.1%. According to the ABS, employment has risen by 3.1% in the past year, growing faster than the labour force. The participation rate also rose 0.1% to a record high 67.2%. “The record employment-to-population ratio and participation rate shows that there are still large numbers of people entering the labour force and finding work in a range of industries, as job vacancies continue to remain above pre-pandemic levels” ABS said. After the release of the report, money markets further reduced the chance of a first RBA rate cut in December to 30% from about 50%. Inflation in August declined to 2.7% Y/Y, within the RBA 2-3% target range, but this was mainly due to support measures of the government to cap electricity prices for consumers. The RBA probably will look through this decline and combined with an ongoing strong labour market, it won’t feel a rush to cut from the 4.35% currently. The Aussie dollar this morning rebounded modestly against a broadly strong dollar (AUD/USD 0.669).

At a press conference held this morning, China Housing Minister Ni Hong announced that the country will raise credit support for ‘white list’ housing projects to Rmb 4tn. The measure is part of series that were recently announced to address a deep-rooted real estate crisis in the country and prevent further negative spill-over effects to the economy. Until now, loans for the approved white list amounted to Rmb 2.23tn. White list projects can receive financing to facilitate that developers can further complete construction projects and deliver homes to buyers. For now, the reaction of Chinese markets to press conference was muted (CSI 300 +0.25%). The yuan is losing marginal ground against the dollar (USD/CNY 7.123).

• EURUSD continues the sell-off
• Immediate support at medium-term uptrend line
• Stochastic edges lower in oversold area

EURUSD is experiencing more losses a few hours ahead of the ECB interest rate decision, sending the market beneath the 200-day simple moving average (SMA) and the 1.0870 resistance.

Technically, the stochastic oscillator is extending its negative momentum in the oversold zone creating a bearish crossover within its %K and %D lines. Moreover, the RSI is moving horizontally near the 30 level.

As the price has lost more than 3% since the pullback from the 1.1200 round number, it may then challenge the medium-term uptrend line near 1.0810. Slightly below that, the long-term ascending trend line at 1.0775 may act as a turning point in the market. A lower move could switch the outlook to bearish.

On the other hand, a rise above the 200-day SMA could add some optimism for bullish movement, hitting the 1.0950 and the 1.1000 key levels.

All in all, EURUSD has been in a selling interest over the last three weeks and only a rally above the 1.1200-1.1215 restrictive region would change the current short-term outlook.

Short Term Elliott Wave View in spot Silver (XAGUSD) suggests that rally from 8.8.2024 low is in progress as an impulse. Up from 8.8.2024 low, wave 1 ended at 30.18 and dips in wave 2 ended at 27.69. Wave 3 higher ended at 32.71 and pullback in wave 4 ended at 30.13 with internal subdivision as an expanded Flat structure. Down from wave 3, wave ((a)) ended at 30.86 and wave ((b)) rally ended at 32.95. Wave ((c)) lower ended at 30.1 and this completed wave 4 in higher degree.

The metal has turned higher again in wave 5 with internal subdivision as a 5 waves impulse. Up from wave 4, wave (i) ended at 30.76 and wave (ii) ended at 30.2. Wave (iii) higher ended at 31.3 and pullback in wave (iv) ended at 31.04. Final leg wave (v) ended at 31.62 which completed wave ((i)) in higher degree. Pullback in wave ((ii)) ended at 30.70. Wave ((iii)) is in progress higher and as far as pivot at 30.1 low stays intact, expect short term dips to find buyers in 3, 7, or 11 swing for further upside.

Silver (XAGUSD) 60 Minutes Elliott Wave Chart

XAGUSD Elliott Wave Video

https://www.youtube.com/watch?v=EipqY2OwPKY

Daily Pivots: (S1) 193.63; (P) 194.47; (R1) 195.24; More...

Intraday bias in GBP/JPY remains neutral for the moment. On the upside, break of 195.95 will resume whole rise from 180.00 to 61.8% retracement of 208.09 to 180.00 at 197.35 next. Sustained break there will target 208.09 high. On the downside, below 192.87 minor support will turn bias back to the downside for 189.54 support. Further break there will target 183.70 support.

In the bigger picture, price actions from 208.09 are seen as a correction to whole rally from 123.94 (2020 low). The range of consolidation should be set between 38.2% retracement of 123.94 to 208.09 at 175.94 and 208.09. However, decisive break of 175.94 will argue that deeper correction is underway.

Daily Pivots: (S1) 162.14; (P) 162.51; (R1) 162.91; More....

Intraday bias in EUR/JPY stays neutral at this point. On the upside, firm break of 163.86 resistance will resume the rebound from 154.40 to 61.8% retracement of 175.41 to 154.40 at 167.38. On the downside, break of 161.00 minor support will turn bias back to the downside. Further break of 158.09 will target 154.40/155.14 support zone.

In the bigger picture, price actions from 175.41 are seen as correction to rally from 114.42 (2020 low). The range of consolidation should have been set between 38.2% retracement of 114.42 to 175.41 at 152.11 and 175.41 high. However, decisive break of 152.11 would argue that deeper correction is underway.