Source: WeChat public account Meow Sister Trading Diary

On Tuesday (May 20), the dollar index hovered around 100.43, gold retreated to $3,221, and Bitcoin rebounded again, breaking through $105,000. Wall Street's largest whale, Strategy, and Japanese investment company Metaplanet successively announced their bullish stance on increasing Bitcoin holdings! The Federal Reserve emphasizes a wait-and-see stance, reducing the likelihood of interest rate cuts this summer. White House advisor Kevin Hassett hinted at the possibility of reaching more bilateral trade agreements.

Short-term uncertainty in Bitcoin has not deterred long-term buyers from increasing their holdings. Strategy (formerly MicroStrategy) announced the purchase of 7,390 Bitcoins at an average price of approximately $103,500, bringing its total holdings to 576,230 Bitcoins.

Strategy reports that Bitcoin's return so far this year is 16.3%. Based on total holdings, the average price per Bitcoin is $69,726. At current prices, the total value of the Bitcoins held by the company exceeds $59.2 billion, with unrealized gains of $19.2 billion, accounting for 47%.

At the same time, Japanese investment company Metaplanet announced earlier this week that it acquired 1,004 Bitcoins, bringing its total to 7,800 Bitcoins.

The Federal Reserve emphasizes a wait-and-see stance, reducing the likelihood of interest rate cuts this summer.

Trump claimed personal success in restarting ceasefire negotiations between Russia and Ukraine; the Vatican has proposed to host the talks.

Federal Reserve officials Kashkari and Jefferson pointed out significant uncertainty in trade policy, putting pressure on investment and hiring plans.

White House advisor Kevin Hassett hinted at the possibility of reaching more bilateral trade agreements, but the details remain unclear.

Powell is expected to speak later this week as the market digests the risks of yield misalignment on policy effectiveness.

Traders remain skeptical about the dollar's role as a safe haven, and concerns about the coordinated appreciation of Asian currencies are also intensifying.

The market expects a 91.6% chance that interest rates will remain at 4.25%-4.50% in June, and a 65.1% chance that rates will remain unchanged in July.

However, by September, the likelihood of cutting rates to 4.00%-4.25% is nearly coin flip (49.6%). Further easing is expected throughout 2025 and even into 2026, potentially reaching 3.25%-3.50% by the end of 2026.

Dollar Technical Analysis

FXStreet analyst Patricio Martín stated that the dollar index is currently trading around the 100.30 mark, with little daily fluctuation, positioned between the support level of 100.06 and the resistance level of 100.90. The Relative Strength Index (RSI) and Commodity Channel Index (CCI) are both in the low 40s, indicating neutral momentum, while the Moving Average Convergence Divergence (MACD) is sending a mild buy signal. Momentum (10) is hovering near zero, leaning bearish.

The 20-day simple moving average (SMA) supports a buying bias, but the 100-day and 200-day simple moving averages, as well as the 10-day exponential moving average (EMA) and 10-day simple moving average, all send long-term sell signals. Resistance levels are at 100.30, 100.57, and 100.58, with key support levels at 100.10 and 99.94.

On the 4-hour chart, the momentum trend shows a more pronounced bearish outlook: the Moving Average Convergence Divergence (MACD) has issued a sell signal, the exponential moving average and simple moving averages (10, 20) are all in a bearish trend, while the stochastic oscillator (%K line) remains neutral. If market sentiment deteriorates, a Fibonacci retracement support level (94.19-98.18) may be retested.

Gold Technical Analysis

FXEmpire analyst James Hyerczyk stated that gold prices rebounded from last week's decline due to a weaker dollar and escalating geopolitical tensions reigniting safe-haven demand. Technically, gold prices are holding around the 50-day moving average of $3,169, and traders are closely watching the level of $3,238 as a trigger point for a breakout.

If gold prices decisively break through this resistance level, it could open an upward channel towards $3,277 and $3,310, with further upward targets at $3,435 and $3,500. This rise is a response to Moody’s downgrade of the U.S. sovereign credit rating again, noting that the U.S. has long-term fiscal imbalance issues.

This news, coupled with rising U.S. Treasury yields (10-year Treasury yield reaching 4.51%, 30-year Treasury yield exceeding 5%), triggered risk aversion in the entire market. Despite the rise in yields, the dollar index fell by 0.5%, supporting gold prices' rise.

The RSI on the gold chart is currently around 49.2, indicating a neutral level, but the rebound from the 50-day moving average suggests buyers are defending the key support level.

Bitcoin Technical Analysis

CoinTelegraph pointed out that on May 18, Bitcoin broke through the resistance level of $105,820, but the bulls failed to maintain this momentum.

Sellers are expected to firmly defend the region between $107,000 and $109,588. The 20-day moving average ($100,787) is a key support level to watch on the downside. A rebound from the 20-day moving average indicates that positive sentiment still exists. Bulls will try again to break through the upper region.

If successful, Bitcoin could soar to $130,000. If the price continues to decline and falls below the psychological key support level of $100,000, this optimistic view will be invalidated in the short term. At that time, Bitcoin may drop to the 50-day moving average of $91,916.