Pain ahead? 🧐 - Gold, Dollar, Bitcoin

What’s up everyone. Happy Friday! Hope you’ve all had a fantastic start to your 2023.

Quick one today as we try to unpack this recent (and fun) bear market rally.

Charts we’ll cover include the DXY, GOLD spot, and Bitcoin

Let’s dive right in…

We’ll kick things off by taking a look at the DXY + GOLD Daily charts.

If you didn’t know already, these two typically move inversely of one another.

One goes up, the other goes down, and vice versa.

On the left we can see that Gold has been on a tear the last few months. Up 7% this year alone. 

A healthy pullback wouldn’t come as a surprise, especially when looking at the AlgoBuddy Momentum 2.0 indicator — which is showing signs of an overbought GOLD.

You can see the last time the Momentum 2.0 was in this range, a pullback occurred.

Same goes for the DXY. Back in September the Dollar showed signs of being overbought, and a pullback followed.

We’re now seeing signs of oversold — paired with the opposite on the Gold chart.

A reversal on these charts is definitely in the cards.

Switching gears to Bitcoin. We’ve seen a parabolic run up since the start of 2023, with Bulls back in full force.

Everyone’s been asking — “is the bull really back on…?”.

We’re seeing some interesting candles the last few days and we’ve mapped out similar instances where a pullback followed.

Back in August, November, and now late January. Pair this with the Momentum 2.0 also showing signs of overbought, and the bears might just be roaring back.

If a drawdown occurs, the closest / strongest support we have right now is $19,000. Which we’ve laid out in the purple box.

Keep in mind and be weary that this could also be another bull flag forming hinting at another run up. 

Eyes peeled out there. Have a great weekend!

-The AlgoBuddy Team