US stocks rose to a record high after the Senate passed the $1 trillion infrastructure bill. The Dow Jones jumped by more than 162 points and reached an all-time high of $35,264. The S&P 500 index added 10 points, helped by the energy sector as the price of crude oil stabilized. The materials segment reacted favourably to the infrastructure bill that will see the US invest in roads, bridges, broadband, rail, and other initiatives. Also, stocks rose after favourable corporate earnings. Most companies that have published their results this earnings season have beaten consensus estimates.
Bitcoin and other cryptocurrencies remained steady after strong Coinbase quarterly earnings. The company reported a revenue of more than $2.23 billion, which was higher than the median estimate of $1.78 billion. Its earnings per share rose to $3.45. As a result, its net profit rose to $1.6 billion, which was 4,900% from a year earlier. Of its revenue, $1.9 billion came from transaction revenue while $100 million came from its subscription services. Still, the shares are down by almost 30% from when it went public through direct listing. Bitcoin held steady above $45,000 while Ethereum remained unchanged at $3,100.
The EURUSD remained in under pressure as traders waited for the German and US inflation data. Analysts expect that the headline US inflation rose by 5.3% in July while core CPI rose to 4.3%. If they are right, the two will be slightly lower than the previous 5.4% and 4.5%. In Germany, they expect that the headline CPI rose by 3.8% in July while the harmonised CPI rose by 3.1%. Other important numbers scheduled today will be the EIA inventories report and the Italian inflation data.
EURUSD
The EURUSD declined to 1.1718, which was the lowest level since March 31. On the daily chart, the pair moved below the 25-day moving average. It also struggled to move below this level in March. The price is also along the 38.2% Fibonacci retracement level while the Relative Strength Index (RSI) has moved to the oversold level. Therefore, the next level to watch will be the 50% Fibonacci retracement level at 1.1485. Still, there is a possibility that a relief rally will happen today.
GBPUSD
The GBPUSD pair has been in a steep sell-off recently. The pair declined to a low of 1.3827, which was the lowest level since July 29. On the four-hour chart, the pair moved to the 38.2% Fibonacci retracement level. It has also formed a descending channel that seems like a bullish flag pattern. Oscillators like the RSI and MACD have also been in a downward trend. Therefore, while the overall trend is bearish, there is a possibility that the pair will rebound as bulls attempt to reach the 61.8% retracement level at 1.3980.
BTCUSD
The BTCUSD pair held steady after strong Coinbase earnings. The pair is trading at 45,816, which was slightly below this week’s high of 46,615. On the 4 hour chart, the pair has moved above the key resistance at 41,412. It is also slightly above the 25-day moving average. The pair also seems to be forming a bullish flag pattern. Therefore, the pair will likely break out higher.
