BTC/USD Prices Fall into APAC Trade as Oil and Metals Catch a Bid

[MongiIG]

Jun 28, 2022 | DailyFX
Thomas Westwater, Analyst

BITCOIN, BTC/USD, CHINA, OIL, COPPER, IRON ORE - TALKING POINTS

• Bitcoin prices fall alongside US stocks despite rosy US economic data
• Copper and iron ore prices may rise further after PBOC comments
• BTC/USD falls for second day, prices eye the psychological 20,000 level

TUESDAY’S ASIA-PACIFIC OUTLOOK
A risk-off tone sent US markets lower overnight, a move that is likely to extend into today’s Asia-Pacific trading session. The Nasdaq-100 Index (NDX) fell 0.81% in New York trading. The drop in technology stocks followed encouraging data out of the United States that showed the demand for goods across manufacturers remains strong.

Bitcoin prices fell too likely as a result of the broader pullback in market sentiment. In an interview, SEC Chair Gary Gensler labeled Bitcoin as a commodity. That would suggest that Bitcoin may better fall under the regulatory scrutiny of the Commodity Futures Trading Commission (CFTC). Mr. Gensler made a clear distinction that he does not consider other cryptocurrencies to be a commodity, however.

Asian markets traded mostly higher on Monday, brushing off a report out of China that showed a drop in profits for industrial firms. The drop for May, however, was less severe than the prior month, crossing the wires at -6.5% compared to -8.5% in April. Increased profits from higher energy costs likely aided firms that produce gasoline and other energy-derived products.

Copper and iron ore prices moved higher despite Monday’s Chinese economic data. That is likely due to comments from the People’s Bank of China’s Governor Yi Gang. Mr. Gang stated, in a television interview, that “Monetary policy will continue to be accommodative to support economic recovery in an aggregate sense.” That statement appeared to encourage some bidding across the industrial metals space.

Elsewhere, oil prices moved higher across the WTI and Brent crude benchmarks. The G7 leaders, currently meeting in German, are said to be on the verge of announcing a plan to cap the price of Russian oil while still allowing it to be sold to major buyers like China and India. That plan would aim to hit Russia’s oil coffers while still lowering the price of oil on the global market. Details are expected as soon as tonight.

NOTABLE EVENTS FOR JUNE 28:
Japan – 2-Year JGB Auction
South Korea – Consumer Confidence (June)
Japan – Retail Sales (May)
 

BTC/USD TECHNICAL FORECAST
Bitcoin prices fell for a second session, but losses were moderate compared to the selling seen earlier this month. The 20,000 psychological level remains a key level of potential support should prices continue to fall. A rebound may see the 20-day Simple Moving Average (SMA) step in as resistance. The MACD oscillator flashed a bullish signal earlier this week, crossing above its signal line.

BTC/USD DAILY CHART

Chart created with TradingView