ETHUSD and BTCUSD rally accelerates as investors buy the dips

UK stocks moved higher on Monday as investors continued to assess the impact of last week’s interest rate decision by the Bank of England (BOE). As was widely expected, the bank decided to hike interest rates in a bid to slow inflation. Stocks also rose even as worries rose that Russia was close to invading Ukraine. In a statement on Sunday, the US said that Russia was about 70% prepared and could carry out an invasion at any time. The main consequence of an invasion will be higher oil and gas prices. Meanwhile, data by Halifax showed that UK home prices rose by 9.7% in January after rising by 9.8% in the previous month.

The Australian dollar rose on Monday after Australia made a major change to its Covid-19 protocols. In an announcement, the prime minister said that the country will accept foreigners who have had a double vaccination. That was a change in policy considering that the country has been closed for most foreign travellers since the pandemic started. The announcement came shortly after the Australian Bureau of Statistics showed that the country’s retail sales jumped by more than 8% in the fourth quarter. It also came a week after the RBA Governor said that the bank will likely hike rates this year.

The euro tilted higher on Monday as more ECB officials warmed up to higher interest rates later this year. Some members who talked to the press expressed their optimism that the bank will implement at least two hikes in 2022. The pair also rose after the weak German industrial production data. The country’s production declined by 0.3% in December even as the auto industry did well. The performance means that production was about 6.9% below where it was in February 2020. However, economists noted that the situation will improve in the coming months.

EURUSD

The EURUSD pair rose to a high of 1.1457, which was slightly below last week’s high of 1.1483. It is slightly below the 25-day and 50-day moving averages while the RSI has moved slightly below the overbought level. The pair has also formed a cup and handle pattern. It is currently forming the handle section. Therefore, there is a likelihood that the pair will have a bullish breakout later this week.

USDCHF

The USDCHF pair declined slightly after the relatively strong Swiss unemployment rate data. The country’s jobless rate fell to 2.3% in January. It is trading at 0.9230, which is slightly below last week’s high of 0.9260. It has moved below the key support level at 0.9235 while the Stochastic oscillator has moved from the overbought level. Therefore, the pair will likely keep falling as bears target the key support at 0.9200.

ETHUSD

The ETHUSD pair jumped to a high of 3,085, which was the highest level since January 21st. On the daily chart, the pair is approaching the upper side of the Bollinger Bands and is between the 50% and 38.2% retracement level. The Relative Strength Index and the MACD have also pointed higher. Therefore, the pair will likely keep rising as bulls target 3,100.