Charts of the day: Markets feel pressure as investors turn risk averse

Market Analysis / 4 Min Read
Milan Cutkovic / 22 Apr 2021

Market highlights 

  • Global equity markets are under pressure as investors have turned risk averse
  • A surge in new COVID-19 cases around the globe has been weighing on global markets, but there’s no sign of a panic yet
  • Bitcoin consolidating following Sunday´s flash crash and is struggling to find a clear direction
  • Copper recently broke out of a triangle pattern, and the charts are hinting at a steady continuation of the uptrend
  • Euro has come under slight pressure in the past 24 hours

USTech

Global equity markets are under pressure as investors have turned risk averse. A surge in new COVID-19 cases around the globe has been weighing on global markets, but there’s no sign of a panic yet.

With an overheated stock market that has already priced in a strong economic recovery this year and rising concerns about high valuations, it doesn’t take much to spook market participants. With tech stocks particularly vulnerable, traders are keeping a close eye on the USTECH index. Imminent support is seen at 13,637 points – which is the 23.6 % Fibonacci level of the March-April rally. The key support zone lies between 13,304 and 13,362 points however, with the former being a former major resistance level and the latter being the 38.2 % Fibonacci of the March-April rally. NASDAQ bulls will need this support to hold, otherwise it could be a sign that a deeper correction lies around the corner.

Bitcoin

Bitcoin has been consolidating following Sunday´s flash crash and is struggling to find a clear direction. A sudden price collapse is nothing unusual for BTC, and as long as the cryptocurrency manages to stay around the psychologically important $50k level, bulls will have little to worry about. However, a clear break below that figure could quickly accelerate downside momentum as more investors rush for the exit. Imminent support is seen around $53,350, while the key resistance level to watch is $60k. A breakout above $60k would signal that Bitcoin has managed to bounce back from yet another sell-off and a continuation of the record-setting rally could follow.

Copper

Copper recently broke out of a triangle pattern, and the charts are hinting at a steady continuation of the uptrend, which has remained intact since February 2020. The Daily RSI has not reached overbought territory yet, and there appears to be more room to the upside. Although momentum is still missing, a retest of the February 2021 high at $4.3725 seems likely. Should Copper overcome this hurdle, upside momentum might be easier to be found again.

Euro

The Euro has come under slight pressure in the past 24 hours. Rising coronavirus cases dampened risk appetite and sparked demand for safe havens. Some Euro bulls might also look to cash in on long positions ahead of tomorrow´s ECB meeting; while no rate changes are expected, market participants will pay close attention to Christine Lagarde´s comments on Europe´s economic recovery as well as the recent turbulences in the bond market. The charts are hinting at a healthy recovery in EUR/USD. Imminent support is seen at the rising trendline from the April low, followed by a key support zone between 1.1940 and 1.20. A clear break below 1.1940 would signal that the recovery has lost momentum. However, the 1.1860 level is likely to attract some buyers again.

The information is not to be construed as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product, or instrument; or to participate in any trading strategy. Readers should seek their own advice. Reproduction or redistribution of this information is not permitted.

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