KVB Market Analysis | 15 Oct: Bitcoin Rises 4% in October, Eyes $70K Resistance Amid U.S. Election

Product: XAU/USD

Prediction: Decrease

Fundamental Analysis:

On Monday (October 15) during the European and American trading sessions, gold prices dropped by nearly $23 from their peak. Reports from the US media suggested that Israel might avoid attacking Iran‘s oil infrastructure, easing concerns over tensions in the Middle East. This reduced the demand for gold as a safe-haven asset. After reaching a daily high of $2,666 per ounce, gold prices fell as the US dollar continued to strengthen. Geopolitical factors will keep influencing gold prices. Reports revealed that Israel held security meetings to decide how to respond to attacks from Iran and Hezbollah on Tel Aviv. Israeli Prime Minister Benjamin Netanyahu informed the Biden administration that he would be willing to target Iran's military facilities instead of its oil or nuclear sites. The cooling of market fears on Monday led to a decrease in safe-haven buying, contributing to gold’s price decline.

Technical Analysis:

Although gold prices have dropped from around $2,660 to the $2,650 level, the overall upward trend remains intact. The momentum is still bullish, as indicated by the Relative Strength Index (RSI), though the RSI has slightly decreased, suggesting some selling pressure. If gold stays below $2,650 per ounce, it could pave the way for further declines. The next key support is at $2,600. A break below this level would target the 50-day Simple Moving Average (SMA) at $2,550. On the upside, a break above the October 4 high of $2,670 could open the way to challenge this year's high at $2,685, with the next target at $2,700.

Product: EUR/USD

Prediction: Increase

Fundamental Analysis:

EUR/USD hit a new ten-week low on Monday, starting the week with further declines. The Euro dropped 0.25% against the US Dollar, touching the 200-day Exponential Moving Average (EMA) as the strong USD paired with a weakening EUR. Investors are waiting for the European Central Bank (ECB) Lending Survey on Tuesday to get insights into the banking sector's health. On Thursday, the final European inflation data (HICP) is due, but it may not cause big moves. Markets expect the ECB to cut interest rates by 25 basis points. US Retail Sales data, due Thursday, is forecast to show 0.3% growth for September.

Technical Analysis:

EUR/USD continues to face strong bearish pressure, dropping to the 200-day EMA and nearing the $1.0900 level. Since late September's peak above $1.1200, the pair has fallen nearly 3%, closing lower in nine out of the last 13 trading days. The outlook stays bearish as long as it remains below the 50-day EMA. While the 200-day EMA at $1.0906 may offer some support, the trend points to more downside risks. On the upside, resistance lies at the 55-day SMA at $1.1038, followed by the September high of $1.1214 and the 2023 peak of $1.1275.

Product: BTC/USD

Prediction: Decrease

Fundamental Analysis:

Historically, October is the most bullish month for Bitcoin, and the rebound on October 14th pushed the monthly gain to 4%. This has raised hopes that the worst may be over. Analysts expect that if Bitcoin breaks above the $70,000 resistance level, its momentum will strengthen. According to CoinShares' weekly report on digital asset fund flows, Bitcoin investment products saw an inflow of $419 million at the start of the week. James Butterfill, the company's head of research, said that the inflows into crypto investment products are mainly influenced by the U.S. election, rather than monetary policy outlook.

Technical Analysis:

Bitcoin is showing a strong upward trend, easily breaking the important $65,000 resistance level. This suggests that buyers are back in control and are ready to challenge the next resistance at $66,500. Over the weekend, sellers tried to push the price below the 20-day moving average at $62,500, but buyers held firm and started a strong rebound. Bitcoin faces resistance at $66,500, but if buyers keep the price above $65,000, a breakout is more likely. If that happens, the price could quickly rise to $70,000. Sellers will likely defend the $70,000 to $73,777 zone strongly. If bears want to regain control, they need to push the price back below the moving averages, potentially testing the key support at $60,000.