KVB Market Analysis | 6 September: Bitcoin Hits Monthly Low Amid Economic Concerns

Product: XAU/USD

Prediction: Increase

Fundamental Analysis:

On Thursday, weak US ADP job data hurt the dollar, causing spot gold to rise sharply. It closed up by $21.36, or 0.86%, at $2516.58 per ounce, with a daily high of $2523.54 per ounce. On Friday, investors are looking forward to the US Nonfarm Payrolls report, which is expected to cause big market movements. The ADP private employment data grew at the slowest pace since 2021, raising concerns about a slowdown in the US job market. The ADP report showed an increase of 99,000 private sector jobs in August, much lower than the expected 144,000 and Julys revised figure of 111,000.

Technical Analysis:

Before the Nonfarm Payrolls report, gold prices have risen above $2500, reaching a two-week high. The price movement shows that buyers are gaining momentum, as indicated by the Relative Strength Index (RSI), aiming for further gains in the bullish zone. The easiest path for gold seems to be upwards, and prices may challenge this year's high of $2531. If it breaks this level, the next targets will be the psychological barrier of $2550. On the downside, if gold falls below $2500, the next support will be at $2470. If that fails, the next support area is around $2431-$2435, where the April 12 high and the 50-day Simple Moving Average (SMA) meet.

Product: USD/JPY

Prediction: Decrease

Fundamental Analysis:

USD/JPY couldn't break through the $143.44 level, which could give USD bulls a chance to recover if the US Nonfarm Payrolls data is strong. The pair remains under pressure near $143.39, with momentum indicators suggesting a continued move down toward the $143.00 and $142.50 support levels. USD/JPY has been dropping for three days in a row, reaching a four-week low of $142.85. However, traders pushed the pair slightly up, ending Thursday with a 0.21% loss. As the Asian session begins on Friday, the pair is trading at $143.39, almost unchanged.

Technical Analysis:

USD/JPY dropped to multi-week lows but couldn't break the August 26 low of $143.44. This could offer a chance for USD bulls to recover, despite the pressure from lower US 10-year T-note yields. However, momentum suggests further downside, as indicated by the Relative Strength Index (RSI). With the upcoming US Nonfarm Payrolls report, the path seems to favor more bearish movement. The first support level is the August 26 low at $143.44, followed by this weeks low of $142.85, before testing key psychological levels.

Product: EUR/USD

Prediction: Increase

Fundamental Analysis:

EUR/USD gained for the second day in a row on Thursday, climbing back above the 1.1100 level as traders sold off the US Dollar ahead of Friday‘s highly anticipated US Nonfarm Payrolls (NFP) report. Markets are looking for clues that the Federal Reserve might start cutting rates in September, but US data needs to keep showing weakness for these hopes to stay strong. Meanwhile, European data offered little support, as July’s EU Retail Sales came in below expectations.

Technical Analysis:

Buyers are still stepping in to keep the EUR/USD stable, even though a strong recovery hasn't taken off yet. The pair reached a 13-month high above $1.1200 early last week, but recent weakness in the US Dollar has traders working hard to maintain a bullish outlook. EUR/USD is still trading well above the 200-day Exponential Moving Average (EMA) at $1.0845. However, despite being in bullish territory, the pair is facing increasing pressure as sellers aim for targets just above the 50-day EMA at $1.0956.

Product: BTC/USD

Prediction: Decrease

Fundamental Analysis:

Due to concerns about the economic outlook, investors are pulling out of higher-risk assets in global markets, causing Bitcoin's price to drop to its lowest level in a month. At one point, Bitcoin fell below $56,000 before recovering slightly to trade at $56,308.32. Most other major tokens, like Ether, also saw declines. Signs of a weak global economy are making investors nervous, leading to the worst period for global stocks since the August 5 drop. This negative mood has spread to cryptocurrencies, with traders waiting for Friday's US jobs report to see if the economy is slowing further. Other cautionary signs include a drop in open interest in Bitcoin futures on the Chicago Mercantile Exchange to its lowest level since May. Meanwhile, US Bitcoin exchange-traded funds (ETFs) have seen the longest net outflow period since June, according to Bloomberg data.

Technical Analysis:

The technical outlook shows that despite a bullish reaction from the $56,796 weekly support in August, Bitcoin hasn't made any meaningful gains. It is once again testing this support, with the Relative Strength Index (RSI) dropping below the 50.00 line, indicating more losses than gains. Below the current support, the next key level lies around $51,948, with further downside risk towards $47,963. Bitcoin's price is also hovering below the 200-day Simple Moving Average (SMA) at $58,009, a bearish sign. Without strong support, Bitcoin may remain under pressure unless it breaks above $56,000 and the 200-day SMA.

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