Bitcoin prices may fall in APAC trading as Australian jobs data nears

Thursday’s Asia-Pacific outlook

Asia-Pacific markets look set to move lower after sentiment soured overnight in Europe and the United States. The United Kingdom’s July consumer prices index rose to 10.1% y/y, beating estimates and hitting the highest level since the early 1980s. European natural gas prices remain near record high levels, bolstering the chance for a deep Euro Area recession. The FOMC minutes confirmed dovish expectations, although the Fed remains willing to tighten further as it evaluates its earlier policy moves. The Nasadaq-100 Index (NDX) fell 1.21%.

Norsk Hydro announced the closure of its aluminum facility in Slovakia, citing high energy prices. The plant, like many across Germany, was already running at a reduced capacity. Shanghai aluminum prices closed slightly higher Wednesday. WTI crude and Brent crude oil prices traded higher at the NY closing bell after trimming strength from a larger-than-expected draw in US oil stocks. The Energy Information Administration (EIA) reported a 7 million barrel decrease in crude stocks for the week ending August 12.

Chinese stocks may lead losses across APAC today after Tencent, a Chinese tech giant, posted a disappointing earnings report. The US-listed Nasdaq Golden Dragon China Index fell 2.24% in New York. Investors have turned increasingly bearish on China despite some signaling that policymakers may soon bolster monetary and fiscal support. The 1- and 5-year loan prime rates are due for an update next week, with traders expecting a 10-bps cut to both LPRs.

The New Zealand dollar fell around 1% against the US dollar, reversing its post-RBNZ gains. The Australian dollar was also lower, weighed down by ailing sentiment and weaker iron ore prices. However, Australia’s July jobs data may revive the currency.

Analysts see 25k jobs added for July and steady unemployment and participation rates. Given the AUD weakness lately, a rosy print may underpin prices. China’s foreign direct investment data (FDI) is set to cross the wires before the weekend.

Notable Events for August 18:

• Japan – 20-Year JGB Auction
• China – FDI (YTD) YoY (July)

BTC/USD technical outlook

BTC/USD fell to a level of support after bulls failed to clear the 100-day Simple Moving Average (dark blue line) and 23.6% Fibonacci retracement level. Prices have been nearly unchanged since the start of August, but a weakening in BTC’s momentum oscillators suggests that prices may fall.

The Relative Strength Index (RSI) is on track to make a bearish cross below its centerline, while MACD crossed below its signal line. A break below support would threaten the 20-day SMA (light blue line) and potentially drag prices to around the psychologically important 1800 level.

BTC/USD daily chart