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Dec 8, 2017

U.S ECONOMIC DATA BEATS EXPECTATIONS AS BITCOIN BUYERS STEAL THE HEADLINES

U.S DATA IMPROVES

The United States economy continued to post impressive economic data this week, with U.S third fiscal quarter GDP and Consumer Confidence beating market expectations. U.S third quarter GDP posted 3.3 percent growth, while U.S Consumer Confidence moved to its highest level since December 2000.

Traders bought the U.S dollar index on the back of the solid U.S economic numbers, with the greenback gaining the most against commodity linked currencies such as the Australian and Canadian dollar.

BITCOIN $10,000

The price of Bitcoin finally broke through the $10,000 level this week, sparking a buying frenzy in the most widely traded cryptocurrency. Once the BTCUSD pair crossed the $10,000 level, the price quickly accelerated towards $10,600, with Bitcoin eventually finding a ceiling at $11,363.

Towards the end of the week, the price of Bitcoin slipped back under $10,000 mark, as traders took profits from over overbought levels, pushing price back to test the $9,000 support level.

GOLD STRUGGLES

Gold was swiftly rejected from the $1,299 level this week, as the yellow metal again failed to find buying interest above the key $1,300 level. A lack of overall demand and broad-based U.S dollar demand caused a swift $15 sell-off in the price of gold. Traders instead moved into perceived riskier asset classes as the week progressed, with spot gold yet again shunned as the commodities sector came under pressure.

  • Should the price of gold trade below the $1,268 level, further losses towards $1,260 and $1,241.50 appear likely.

  • A clear breach of the $1,290 technical level should lead to buyers testing the $1,295 and $1,300 levels.

STERLING SOARS

The British pound had another rollercoaster week against the U.S dollar, with the GBPUSD pair soaring towards the 1.3500 level. Reports surfaced this week that the UK had agreed to pay the European Union over forty-five billion euros, in a deal dubbed the Brexit ‘Divorce Deal. The news provoked a strong bid in the British pound, as traders and investors view any real progress in negotiations as a positive development for the UK economy.

  • The GBPUSD pair remains a buy above the 1.3380 technical level. Further upside towards the 1.3610 and 1.3750 levels appears possible.

  • Any decline below the 1.3380 level may lead to a decline back towards the 1.3360 and 1.3307 support regions.




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