Market Update: 27 Aug 2020
1 min readAug 28, 2020
So Powell’s backpedaling and fuzzy inflation framework has disappointed the market that was hoping for a formalization of their inflation policy in this speech itself. The first mover was Breakevens (Chart 1) which came off sharply and never retraced even as XAU & USD were head-faked.
As we know BTC is now basically EURUSD (Chart 2), and the big inverted hammer failure at 1.19 will likely put pressure on the crowded short USD/long XAU trade in the short-term at least. Perhaps we will get a formalization at the Sep-16 FOMC meeting and the trend continues higher, but the pain trade is probably lower till then. Again we’re watching 11k & 10.5k on BTC and 360 on ETH to dictate the next price move.
