How October FOMC Minutes Could Move BTC, XAU, and XAG

Bitcoin, gold, and silver prices are exhibiting some volatility during the early hours of the Asian session on Wednesday, with bulls showing strength ahead of the release of the October FOMC minutes.

The FOMC minutes are due at 2:00 ET and present a critical macroeconomic data point for Bitcoin and commodity safe havens, as they have the potential to influence market sentiment.

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BTC, XAU and XAG Brace for Minutes of Fed’s October FOMC Meeting

The October FOMC meeting already happened, but today, a “transcript” of what the FED officials discussed behind closed doors will be revealed.

More closely, it will provide clues regarding the potential rate cut in December, following the recent quarter-point reduction and balance sheet slash.

If it shows the Fed leaning toward cutting, markets could pump fast. If they hint at hesitation or resolve to Powell’s characteristic “wait and see”, the pump could get delayed.

Meanwhile, it is imperative to note that the shutdown disrupted the data, and inflation numbers are missing, meaning the Fed is essentially operating in the dark.

Against this backdrop, today’s report may be the only real signal markets have before December.

Bitcoin Bulls Defend $90,000 Psychological Level

On the one-day timeframe, BTC bulls are defending between the current price of $91,475 and the $90,000 psychological level, preventing further downside. Perhaps today’s FOMC minutes could be the market mover that determines the next short-term directional bias.

However, the RSI (Relative Strength Index) position at 41 shows weak buyer momentum, an outlook that is accentuated by the sizes of the bullish volume profiles (green horizontal bars).

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Furthermore, the RSI indicator is trending south, indicating that momentum is fading, which further tilts the odds in favor of the bears. If the bears have their way, the Bitcoin price could drop to $86,707, earmarked by the 23.6% Fibonacci Retracement level.

In a dire case, the drop could extend to $74,508, levels last tested in April. Such a move would constitute a drop of almost 20% below current levels.

Conversely, if buyer momentum increases at current levels, the Bitcoin price could flip immediate resistance at $94,253 back into support. Notably, however, the bearish volume profiles (red horizontal bars) show more sellers than buyers waiting to interact with the BTC price above the 38.2% Fibonacci retracement level ($94,253 price level).

Gold Price Pushes to Fill the FVG, But $4,135 Remains Critical

The gold price is pushing to fill the market imbalance due to the fair value gap (FVG) between $4,111 and $4,159. With the Gold price trading for $4,113 as of this writing, it has already filled the inefficiency and could very well pull back from here if sellers take over.

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However, with the RSI rising, momentum is still growing, and the gold price could extend, breaking the midline of the FVG at $4,135. A decisive candlestick close above this midline (consequential encroachment) on the four-hour timeframe would confirm the continuation of the uptrend.

Therefore, traders looking to take long positions for the XAU/USD trading pair should consider waiting for a candlestick close above $4,135.

On the upside, momentum is growing, as indicated by the climbing RSI, with significant ground to cover before XAU can be deemed overbought.

Conversely, the red volume profiles show more sellers than buyers (green volume profiles) overhanging the current gold price. Therefore, traders should not be surprised if gold pulls back, especially considering it has already filled the FVG, just by nicking into the zone.

Despite strong downward support, the gold price could drop to lose the critical support at $4,061, effectively tossing XAU/USD into bearish hands. Such a directional bias could see the XAU price retest the $4,014 support level.

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In a dire case, the gold price could fall to the consolidation zone in the area stretching between $4,014 and $3,964 before a possible recovery attempt.

Bears Counter Silver Price’s Push Toward October High

The silver price is also on a tear, taking its cues from the gold price. With immediate support due to the $most critical Fibonacci level, 61.2%, the silver price could extend a neck higher.

The RSI trajectory and position at 61 add credence to the bullish thesis, with more ground north before XAG can be rendered overbought at 70. If the silver price flips the immediate roadblock of $52.46 into a support level, it could target $54.37 next, almost 5% above the current price.

Conversely, the red volume profiles (indicating bearish hands waiting to sell) suggest that the silver price could encounter significant resistance as it pushes for further upside.

If the Silver price suffers a rejection at $52.46, it could revisit the $50.96 support level, below which more sellers could pull the trigger and send it lower to $49.91.