Weekly Market Insights: Bitcoin's Surge, Gold's Challenges, and Crude Oil's Rebound

Updated January 20, 2025

Bitcoin: Rapid Surge with Inauguration Momentum

Bitcoin was the standout performer this week, experiencing significant price movement. On Monday, it initially dropped alongside other major market assets like the US Dollar Index and Gold. However, it quickly recovered during the US trading session and surged over the following four days, approaching its previous high of $127,000.

This movement aligns with expectations that Bitcoin would rally leading up to Trump’s inauguration. On Monday, the daily chart showed support at its lower boundary, marked by a $5,000 lower wick. By Tuesday, long positions began building, and Thursday’s washout presented further opportunities.

Traders should prepare for potential sharp corrections early next week. For breakout trades, setting a stop loss at the previous high of $107,000 can help mitigate risk, while a trailing stop at $108,000 ensures profitable exits in case of pullbacks.

Gold: Facing Resistance and Unpredictable Movements

Gold faced challenges this week, forming a bearish candle on Monday triggered by resistance at $2,735. Many TradingLink traders initiated well-timed short positions near this level. However, yesterday’s breakout above the resistance line stopped out many of these orders.

Gold’s recent bullish wave appears unusual, partly fueled by the market hype surrounding Trump’s inauguration. However, the likelihood of Gold surpassing its previous high of $2,800 remains low due to limited momentum and reliance on the US Dollar Index.

Over the past two weeks, Gold has demonstrated a positive correlation with the dollar, an unconventional trend. On the weekly chart, Gold found support at the midline of the Bollinger Bands, but its ability to sustain this bullish pattern remains uncertain. Next week, a downward correction is anticipated as the current upward movement seems strained and unconvincing.

Crude Oil: Breaking Out with Geopolitical Influence

Crude Oil demonstrated significant strength this week, breaking out of a four-month consolidation range and reaching $81.16. This rally was supported by geopolitical developments, including Trump’s anticipated sanctions on Iran and Russia, which introduced uncertainties to the energy supply chain.

The US inflation CPI index’s decline during this period also provided some support for Crude Oil. On the weekly chart, Crude Oil remains bullish, with its moving averages showing no signs of being tested from below.

Crude Oil’s robust movement and consistent trends make it an ideal asset for swing trades. However, traders should remain cautious of potential short-term corrections around $74, given the rapid rebound and geopolitical risks.

Market Outlook

The first trading weeks of 2025 have showcased significant movements across Bitcoin, Gold, and Crude Oil. Bitcoin continues to dominate with its bullish surge, while Crude Oil benefits from geopolitical uncertainties and a rebound from prolonged consolidation. Gold’s unpredictable behavior warrants caution, especially as it faces resistance and shows signs of a potential correction.

With Trump’s inauguration on Sunday, the market is poised for potential volatility next week. Traders are advised to prioritize risk management and avoid overly aggressive positions. As the new trading year progresses, maintaining discipline and refining strategies will be crucial in navigating the evolving market landscape.