Bitcoin Tests Key Support; Five Major Central Banks Set Rates This Week; Crude Oil Retreats; Dollar Softens; Gold Trades Around $4,000

Bitcoin has slipped below the important $80,000 support level and round number. It is trading around $79,900–$80,200 this morning, below the levels seen last Thursday. An intraday move beneath $80,000 is not the same as a confirmed daily closing breakdown, but sustained trading below that level would substantially weaken the former bullish consolidation. The proposed breakout above $87,293 now looks unlikely to happen.

Central bank decisions dominate this week’s calendar. The Federal Reserve, Reserve Bank of New Zealand, and Bank of Canada announce decisions on Wednesday, followed by the European Central Bank on Thursday and the Bank of Japan on Friday. Holds are expected from the Fed, ECB, and BoJ, while markets anticipate further tightening (rate hikes) in New Zealand and Canada. With much of this already priced in, guidance on subsequent meetings could matter more than the decisions themselves.

The RBNZ is still expected to hike despite last week’s softer inflation data. A third consecutive 0.25% increase would take the Official Cash Rate from 2.75% to 3.00%. Annual inflation slowed to 3.7%, below consensus and the Bank’s forecast, but remains above its 1%–3% target range. The important question is whether the RBNZ signals that further increases are necessary or that the tightening cycle is approaching its end.

The Fed is expected to hold rates, not declare victory over inflation. The federal funds target range is expected to remain at 3.75%–4.00% on Wednesday. Markets nevertheless assign roughly a 77%–80% probability to a December increase. Higher oil prices remain a complication, so traders should distinguish an October hold from a signal that the Fed has finished hiking.

In the Forex market, the US Dollar has softened as Crude Oil and Treasury yields have eased. The Dollar Index is near 101.64, while EUR/USD has recovered slightly to trade near 1.1220. France avoided a Moody’s downgrade, offering the Euro some relief despite continuing unrest and fiscal concerns. The recovery has not yet produced a decisive move above the 1.1300 level highlighted last week, so the longer-term bearish EUR/USD structure remains worth watching. Like other trend traders, I remain short of EUR/USD.

The Japanese Yen has strengthened ahead of the BoJ meeting. USD/JPY is trading near 157.00 after the Yen gained approximately 0.8% last week. The BoJ is expected to leave its policy rate at 1.25% at its meeting next Friday, having raised it last September. Governor Ueda’s assessment of inflation and the timing of further tightening will therefore be more important than an unchanged rate itself.

Crude Oil has retreated today. Brent is around $115–$115.50, while WTI futures are near $102, following reports that Qatari mediators visited Tehran to pursue de-escalation in coordination with the US. Friday’s settlements were much higher than the levels seen early last week: Brent finished at $116.72 and WTI at $103.27. Today’s pullback is therefore an easing from elevated prices, not evidence that the supply-risk premium has disappeared.

Gold is testing $4,000 after a heavy weekly decline. The metal lost more than 4% last week and reached its lowest level since July. It has traded on both sides of $4,000 this morning, with an early recovery towards $4,010. Technically, the picture for Gold looks bearish, as it is established within a descending price channel.

Stock markets face another test from earnings. Asian shares have opened cautiously, while this week’s major corporate results will test confidence in the AI trade after recent volatility.