Bitcoin and gold retreated on Friday after recent gains, with BTC slipping back below $80,000 following another push towards $81,500 and a rejection in the $81,000–$82,000 supply band for the second time in under two weeks. Technical indicators remained stretched: the RSI sat around 78 and the MACD stayed in positive territory, though it pointed to fading upside momentum. Key downside levels were flagged at the 200-day EMA near $72,069, then a secondary zone around the 50-day EMA at about $68,694 and the 100-day EMA near $68,360.
Gold also eased, with XAU/USD trading below $4,600 after a 3% drop from its August peak of $4,697. Price action centred around $4,580, with nearby support mapped to the 100-day EMA at $4,364, the 50-day EMA at $4,336 and the 200-day EMA at $4,315, while a deeper pullback was framed around $4,267. In policy remarks at the Jackson Hole Economic Policy Symposium in Wyoming, Federal Reserve Chair Kevin Warsh referenced elevated US inflation and kept the option of higher interest rates open without offering forward guidance.
Volatility Outlook and Seasonal Trends
Following Fed Chair Kevin Warsh’s hawkish stance at Jackson Hole, we expect increased volatility and downward pressure on both Bitcoin and gold in the coming weeks. Historically, September is the weakest month of the year for risk assets, with Bitcoin averaging a 4.5% decline over the last ten years. Derivative traders should prepare for a defensive market environment as higher-for-longer interest rate fears bolster the US dollar.
Defensive Trading Strategies for Bitcoin and Gold
With Bitcoin struggling below the $80,000 mark and its Relative Strength Index showing overbought conditions at 78, we recommend purchasing protective put options. Targeting strike prices near the 200-day EMA around $72,000 offers a cost-effective way to hedge existing spot portfolios. Alternatively, selling out-of-the-money call options above $82,000 allows traders to collect premium during this expected consolidation phase.
For gold, which has retraced to $4,580, the macroeconomic headwind of rising bond yields makes short-term bearish plays highly attractive. We favor executing bear put spreads on gold options to capitalize on a potential slide toward the $4,364 support level. This strategy limits initial risk while positioning traders to profit if the commodity continues its post-symposium sell-off.
Given the sudden shift in monetary expectations, we urge traders to significantly reduce leverage to avoid liquidation during sharp, news-driven swings. Monitoring the CME FedWatch Tool will be crucial, as rate hike expectations for the upcoming policy meetings are likely to fluctuate wildly. Keeping position sizes conservative and maintaining wide stop-loss orders will help navigate the choppy waters of the next few weeks.
