Tightening fears take down oil & gold, Fidelity eyes another Bitcoin ETF attempt

Oil

It’s going to take a lot to change the minds of energy traders. Fears of a weaker global growth outlook are not going away anytime soon. In the US, good news is bad news as that will suggest the Fed might have to do more tightening. ​ Inflation is stubbornly high in Europe that could trigger a lot more rate hikes and a harsher recession. ​

Even comments from Delta CEO about demand outpacing expectations was unable to provide a boost for oil prices. ​

Oil is looking very vulnerable here as it is getting close again to the spring lows near the upper mid- $60s. One more plunge and that should make OPEC+ very nervous. A drop below the $67.50 level could ​ trigger momentum selling that won’t stop until the $62.50 region.

Gold

Gold remains under pressure as the US consumer still looks strong. Today’s economic data in the US painted a picture of a resilient economy that could be subject to further Fed tightening. The ECB also signaled there is no end in sight for their rate hiking cycle and that has also helped send Global Bond yields higher. It has been pretty ugly for gold since early May and if expectations grow for further Fed tightening, that could send gold tentatively below the $1900 level.

Bitcoin

Bitcoin momentum remains intact as Fidelity joins the quest for the elusive bitcoin etf with BlackRock, Invesco, WisdomTree, and Invesco. It has been about five years of steady denials of every crypto ETF filing, but now optimism is here that one of these financial giants will get one done before summer’s end.

In addition to fresh ETF filings, the crypto market is focused on Grayscale‘s lawsuit against the SEC over, trying to convert its GBTC to a bitcoin ETF. Optimism is growing that Grayscale might have a chance to win this legal battle before the end of summer.

Bitcoin trades above the 30,000 level investors are waiting to see if the rally can continue. Initial resistance comes from the 34,000 level and if we do see a bitcoin ETF approval institutional momentum could take the rally as high as the $40,000 level. Any major setbacks with a BlackRock ETF rejection and a Grayscale defeat could temporarily kill the rally, but optimism will still remain that and the ETF will eventually get done.

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