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Forex and Cryptocurrency Forecast for November 18 – 22, 2024

The financial markets enter the week of November 18–22, 2024, amid significant economic and political developments shaping currency, commodity, and cryptocurrency movements. The recent re-election of Donald Trump has boosted market confidence in a pro-business and deregulation-focused administration, strengthening the US dollar. This has been further supported by robust US economic data, including low unemployment and resilient consumer spending, which reinforce expectations of continued monetary policy tightening by the Federal Reserve.
Globally, the eurozone remains under pressure due to sluggish growth and political uncertainties, which weigh on the euro. Gold prices are responding to the dollar’s strength, as investors weigh the prospects of higher interest rates against the metal's role as a safe-haven asset. Meanwhile, bitcoin is seeing record highs, driven by optimism about regulatory clarity and increased institutional adoption. These factors will be key drivers of market dynamics for EUR/USD, XAU/USD, and BTC/USD in the upcoming week.

EUR/USD



The EUR/USD pair is expected to test the support area near 1.0450, with a potential rebound signalling further growth towards the target level of 1.0875. An additional signal supporting this bullish scenario is a test of the support line on the RSI indicator.
The key level to watch for invalidating this growth outlook is 1.0365. A breakout below this level would indicate further bearish momentum, with the pair likely continuing to decline towards the target of 0.9945. Conversely, confirmation of sustained growth would require a breakout above the 1.0665 level, signalling a breach of the descending channel and opening the path for further upward movement.
This outlook considers the interplay of technical signals and critical support and resistance levels, which traders should monitor closely in the coming week.

XAU/USD

Gold ended the week near 2568, with XAU/USD moving within a bullish channel. Moving averages suggest a bullish trend, with prices testing key signal lines, indicating buyer pressure and potential growth. A decline towards the 2455 support level is expected, followed by a rebound targeting 2675.
A rebound from the RSI support line and the lower border of the bullish channel supports the growth scenario. However, a breakout below 2385 would invalidate this outlook, signalling a decline towards 2315. Confirmation of continued growth would require a breakout above 2625, indicating further bullish momentum.

BTC/USD

Bitcoin (BTC/USD) closed the week at 89,337, moving within a bullish channel that suggests a continued upward trend. The moving averages and recent upward breakout through signal lines support this bullish momentum. However, a short-term correction towards the 76,505 support level is possible, from which a rebound could lead to further gains, targeting levels above 112,605.
Key signals for the week include a bounce from the bullish channel’s lower boundary and the RSI support line. A drop below 73,605 would invalidate the bullish outlook, potentially leading to a decline towards 65,605. Conversely, a breakout above 99,905 would confirm further upward movement in line with the channel’s width.

NordFX Analytical Group

Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.

Forex and Cryptocurrency Forecast for November 04 – 08, 2024

In October 2024, the U.S. labor market saw limited movement, with total nonfarm payroll employment rising by only 12,000 jobs, keeping the unemployment rate steady at 4.1%. Health care and government sectors saw continued job growth, while temporary help services and manufacturing experienced declines, the latter impacted by strike activity. Hurricanes Helene and Milton, which caused significant damage and evacuations in the southeastern U.S., may have influenced employment figures and data collection, potentially skewing labor data.
The Bureau of Labor Statistics noted, however, that it cannot quantify the hurricanes' impact on employment shifts. Moreover, the storms did not visibly affect the unemployment rate. After the data release, the dollar fell sharply by 0.35%, while stock indices and cryptocurrencies saw a recovery. Markets are now anticipating rate cuts in 2025, with expectations of a 25 basis point reduction at the November and December Federal Reserve meetings.
The U.S. presidential election on November 5th will be a major focal point for the markets next week, likely driving significant volatility around that date.

EUR/USD

The Euro saw a slight increase over the week, though it appears to be struggling to hold onto those gains. Currently, the market seems likely to remain volatile and move sideways, with prices hovering around the 50-Week EMA.
If the price breaks above the top of previous week’s candlestick, it could face resistance at the 1.10 level. Conversely, the 1.0750 level offers strong support and is worth monitoring closely. Should the price fall below this point, it may target the 1.05 level, which has consistently served as a major support zone over the past few years. Overall, the market appears to lack clear direction at this stage.



XAU/USD

Escalating geopolitical tensions have led investors to turn to safe-haven assets like gold, fueled by heightened risk aversion and worries about global market stability. Gold has repeatedly set new records this year, climbing over 30% amid expectations of further central bank rate cuts and ongoing geopolitical uncertainties. According to LSEG data, this marks its strongest annual growth since 1979.
Gold had a bullish run past week, but momentum appears to be slowing. The weekly candlestick reflects some hesitation, indicating that a phase of profit-taking might be near. The $2800 mark, a significant psychological level, has drawn substantial market interest. Traders should monitor any pullbacks closely, as these may present buying opportunities, particularly around the $2600 level.

BTC/USD

Bitcoin (BTC) saw a gain of over 2% this week until Friday, with a strong start bringing it close to a new all-time high, followed by a notable decline as signs of profit-taking emerged.
Analysts suggest that Bitcoin might experience a pullback in the coming days ahead of the U.S. presidential election, a critical event that could shape the regulatory landscape for cryptocurrencies. The continuation of Bitcoin’s recent rally in the short term is closely tied to the election results, with many traders believing that a victory for former President Donald Trump could result in more favorable regulatory conditions for the crypto market.
If BTC continues its decline and closes below the $69,500 mark, it could potentially fall over 5% to test the next key support at $66,000, aligning closely with the breakout point of the downward-sloping parallel channel pattern near $65,800 on the weekly chart. However, if Bitcoin stays above $69,500, it may attempt to retest and possibly break through its all-time high of $73,777.

NordFX Analytical Group

Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.

CryptoNews



– On Monday, 14 October, the price of bitcoin rose above $65,000. Then, on 15 October, a local high was recorded at $66,515. The last time the leading cryptocurrency reached such heights was on 27 September. The positive dynamics were influenced by the growth of U.S. stock indices, particularly the S&P 500. Another driving factor was the anticipation of expanded economic stimulus measures by the Chinese authorities.
Analysts note that similar price movements were observed before the U.S. presidential elections in 2016 and 2020. In 2016, BTC traded in a very narrow range for more than three months. However, three weeks before the election, it began to rise, doubling in value by the start of 2017.
A similar scenario unfolded in 2020 — initially, there was sideways movement for half a year, and then, three weeks before the vote, a bull rally began. As a result, starting at $11,000, the flagship cryptocurrency nearly tripled in value by early January, reaching $42,000. If a similar trend occurs this time, it is possible that bitcoin could welcome the New Year of 2025 within the range of $120,000 to $180,000.

– Analysts cite two more reasons that contributed to the current rise in bitcoin. One of them was the speech made by U.S. presidential candidate Kamala Harris on Monday, 14 October, in which she promised to support a regulatory framework for cryptocurrencies. The details of her plan remain unknown, and it is possible that this is just pre-election rhetoric. Nevertheless, the promise has sparked some hope that Harris will not continue Biden's strict policy towards the digital industry.
The second reason that pushed BTC's price upward was the news that the administrators of the bankrupt crypto exchange Mt. Gox had postponed their plans to return stolen bitcoins to creditors by a year.
According to some reports, Mt. Gox held coins worth around $10 billion. Payments to creditors began in July of this year and were initially expected to be completed in the coming months. The sale of such a large number of coins could have significantly lowered bitcoin prices. However, it has now been announced that the distribution of tokens will only be completed by the end of October 2025. Therefore, the anticipated dump due to this reason has been cancelled.

– Although Kamala Harris' overall crypto plans remain largely a mystery, some details have emerged. According to media reports, if elected President of the United States, she intends to support Black crypto investors through the "Opportunities for Black People Program." This program is expected to impact more than 20% of Black Americans who own cryptocurrencies. Harris has stated that new technologies, such as blockchain, can help expand access to banking services and financial opportunities for this demographic. But that’s not all. As part of the announced program, the Vice President also plans to offer nearly one million interest-free loans of up to $20,000 to Black entrepreneurs looking to start businesses related to cannabis.

– Larry Fink, CEO of BlackRock Inc., the world’s largest asset management company ($10.5 trillion), believes that market participants are mistaken in expecting the U.S. Federal Reserve to lower the key interest rate too quickly. "The amount of easing priced into the forward curve is just crazy," he stated in an interview with Bloomberg.
When asked about the connection between cryptocurrencies and the U.S. elections, Fink responded that it doesn’t matter who becomes president, as the adoption of digital assets in society will continue to grow regardless. This is due to financial institutions around the world seeking ways to diversify asset allocation.
It is worth noting that the CEO of BlackRock was previously sceptical about all digital assets. However, he now asserts that bitcoin has already become an alternative to other commodities, including gold. Fink highlighted that BlackRock is focused on improving access to the crypto market through exchange-traded products. He mentioned the recently launched ETH-ETF, the Ishares Ethereum Trust, which saw a net inflow of over $1 billion in just two months. Similarly, the BTC-ETF, Ishares Bitcoin Trust, has grown to $23 billion in the first nine months since its launch.

– Unlike Larry Fink, the Governor of the Reserve Bank of India (RBI), Shaktikanta Das, remains unfavourable towards bitcoin and altcoins. He believes that the digital rupee (CBDC) could become a more stable and controllable digital currency, protecting Indian citizens from the high volatility of crypto-assets and the associated risks. The RBI Governor optimistically stated that "through the use of central bank digital currency, India will have a unique opportunity to become a leader in international payments."
However, the current statistics suggest otherwise. According to the RBI, since December 2023, the number of daily transactions involving the government-issued stablecoin has dropped by nearly tenfold. As a result, the RBI has decided to take a more cautious approach to the launch of the digital rupee, opting for a phased implementation.

– The trader and analyst known as Stockmoney Lizards believes that before the next pump, BTC is likely to see a correction to the $63,000–63,600 range. "Bitcoin is entering the fear of missing out [FOMO] zone," writes Stockmoney Lizards. "At some point, there will be a temporary correction, and the positions of traders caught by FOMO will be liquidated before the upward movement resumes. […] The $65,000–66,000 range acts as a natural resistance zone."
Stockmoney Lizards' colleagues also point out that, despite the recent rise of the coin to $66,500, the price has yet to break through the upper boundary of the downward channel that started in March. At the moment, this boundary is at the $68,050 level.

– The crypto-detective operating under the pseudonym ZachXB has reported receiving numerous messages in recent months from victims in Western Europe who were held at gunpoint and threatened with death if they did not transfer their cryptocurrency to the criminals. In one case in June, a user lost $4.3 million in digital assets during a home robbery. Using stolen personal data, the thieves discovered the victim's home address, tracked them down, and, posing as couriers, forced their way into the house, compelling the victim to transfer all their cryptocurrency.
Recently, former CEO of the educational crypto platform Revelo Intel, Nick Drakon, admitted that he, too, was a victim of a violent robbery. The criminals threatened his wife and eight-month-old son, and under the threat of a gun, Drakon was forced to transfer both personal and corporate funds, as well as all his digital assets, to the attackers.

– CryptoQuant analysts note that the fear of a further drop among small retail investors is benefiting large players, who are not concerned with the short-term fluctuations of the leading cryptocurrency. "The accumulation of bitcoin by whales in the price range of $54,000 to $68,000 is a significant indicator. New whales are entering the game and actively accumulating, while the older ones are increasing their positions. Overall, all whales are accumulating within this price range. Their growing balances suggest that a rise is on the horizon, either in the medium or long term," says the CryptoQuant report. "Bitcoin has been trading in a narrow range for seven months now," the experts write, "and the longer this period lasts, the more powerful the rally of the first cryptocurrency and the overall crypto market capitalisation could be."

Forex and Cryptocurrency Forecast for October 14 – 18, 2024

EUR/USD: Doves Outplay Hawks, Score 76:24

● Last week, four key events attracted the attention of the markets. The week began on Monday, 7th October, with the release of eurozone retail sales data. According to the statistics, retail sales in August grew by 0.2% month-on-month and by 0.8% year-on-year, which was almost in line with forecasts. Analysts surveyed by Reuters had expected growth of 0.2% (m/m) and 1.0% (y/y).
● The next significant event was the release of the minutes from the September FOMC (Federal Open Market Committee) meeting of the US Federal Reserve on Wednesday, 9th October. This 13-page document provided a detailed assessment of the economic situation and the opinions of Committee members on the prospects for monetary policy. The Fed downgraded its forecast for US economic growth in 2024 from 2.1% to 2.0%, while keeping the 2025 estimate unchanged at 2.0%. The inflation forecast for the current year was lowered from 2.6% to 2.3%, and for the following year, from 2.3% to 2.1%.
According to Fed Chair Jerome Powell's statement, the regulator's baseline scenario assumes further monetary policy easing. However, he noted that the Fed is in no hurry to act. The minutes revealed that Committee members are divided into two camps regarding the expected pace and magnitude of the key interest rate cuts. Some believe that it is essential to avoid a rate reduction that is either too late or insufficient, citing risks to the labour market. Others argue that a rate cut that is too swift or too large could halt the progress made in the fight against inflation or even lead to its resurgence.
● The next meeting of the US regulator will take place on 6-7th November. Market participants expect to see two more rate cuts this year, each by 25 basis points. According to the CME FedWatch tool, there is a 76% probability that the first of these cuts will occur next month, while the probability that the rate will remain unchanged is estimated at around 24%. Against this backdrop, the major US stock indices rallied, with the S&P 500 and Dow Jones reaching record closing levels.
● The third event took place on Thursday, 10th October, with the release of US inflation data. According to the US Department of Labour, while consumer prices in September slightly exceeded forecasts, annual inflation reached its lowest level since February 2021.
The Consumer Price Index (CPI) remained at 0.2% month-on-month, despite forecasts of 0.1%. On an annual basis, the CPI was 2.4% in September, which was higher than the forecast of 2.3% but lower than the previous value of 2.5%. Core inflation (Core CPI), which excludes volatile food and energy prices, rose to 3.3% year-on-year, exceeding both the forecast and expectations of 3.2%.
These figures reinforced investors' expectations that the US Federal Reserve would proceed with another rate cut in November. The EUR/USD pair reacted to the inflation data with volatility, fluctuating within a 50-point range (1.0904-1.0954), but by the start of Friday, it had returned to where it had been at the beginning of Thursday – in the middle of the range around 1.0935.
● It is worth recalling that on 18th September, the Federal Reserve lowered the key interest rate for the first time since the start of the COVID-19 pandemic, and by 50 basis points at once. According to Jerome Powell, this sharp move was necessary to protect the labour market. However, data from the US Bureau of Labour Statistics, released on 4th October, showed the largest increase in new jobs in six months and a decrease in unemployment. The number of new jobs in the non-farm sector (NFP) rose by 254K, following an increase of 159K in August, and far exceeded market expectations of 140K. The unemployment rate dropped to 4.1% from 4.2%. According to analysts, this confirmed the resilience of the economy, and the expectation of a gradual rate cut this year. 
● The final event of the week, which had the potential to influence the dynamics of the US Dollar Index (DXY) and consequently EUR/USD quotes, was the release of another important inflation indicator on Friday, 11th October – the US Producer Price Index (PPI). According to the report from the US Bureau of Labour Statistics, the PPI rose by 1.8% year-on-year in September. This followed an increase of 1.9% in August and exceeded market expectations of 1.6%. The core PPI, on a yearly basis, grew by 2.8% (forecast 2.7%). On a monthly basis, the PPI remained unchanged, while the core index rose by 0.2%.
● Despite the fact that producer price inflation exceeded forecasts, the market barely reacted to these figures. As a result, the week's final note was struck at the same level, 1.0935. Most analysts (70%) predict a decline in the EUR/USD pair ahead of the ECB meeting. The remaining 30% have taken a neutral stance. Indicators on D1 mostly align with the analysts’ outlook. All oscillators are in red, though a third of them signal the pair is oversold. Among trend indicators, 75% point south, while 25% point north.
The nearest support for the pair is in the 1.0890-1.0905 zone, followed by 1.0780-1.0805, 1.0725, 1.0665-1.0680, 1.0600-1.0620, 1.0520-1.0565, and 1.0450-1.0465. Resistance zones are located around 1.0990-1.1010, then 1.1045, 1.1100, 1.1155, 1.1185-1.1210, 1.1275, 1.1385, 1.1485-1.1505, 1.1670-1.1690, and 1.1875-1.1905.
● The most interesting day next week is expected to be Thursday, 17th October. On this day, eurozone consumer inflation (CPI) data will be released, followed by a meeting of the European Central Bank. Some experts anticipate that the ECB might opt for another 25 basis point cut in the key interest rate. In addition to this decision, the ECB's leadership comments on monetary policy will undoubtedly attract significant interest. Moreover, on 17th October, data on US retail sales and initial jobless claims will also be released.

CRYPTOCURRENCIES: The Crypto Industry's War with the SEC Enters a 'Hot' Phase



● We will begin our review of the crypto industry by picking up where we left off last time—with the "information bomb" that was expected to explode on 8-9th October. The American television channel HBO had promised to reveal the real identity of Satoshi Nakamoto. And indeed, they did name someone, but few believed it. According to the authors of the documentary Electronic Money: The Mystery of Bitcoin, the pseudonym Nakamoto allegedly belonged to 39-year-old Canadian Peter Todd. Todd was indeed one of the early developers of Bitcoin Core, but he was never among the main suspects thought to be Nakamoto.
The filmmakers presented several arguments, including the use of British/Canadian spelling in Nakamoto's writings and a correlation between the timing of Todd’s educational schedule and Nakamoto's posts. The key "evidence" was a message posted on the Bitcoin forum in 2010, supposedly left by Todd under Nakamoto’s name. However, these arguments failed to convince most viewers. Ki Young Ju, CEO of CryptoQuant, even called the documentary "disgusting" and expressed astonishment at how misguided the conclusions were.
● Another, more tangible, sensation could emerge from the latest round in the ongoing battle between the US Securities and Exchange Commission (SEC) and representatives of the crypto industry. Speaking at New York University’s School of Law, SEC Chair Gary Gensler stated that cryptocurrencies are unlikely to ever be widely used as a payment method and will continue to be viewed primarily as a store of value. Gensler also praised his agency’s approach to enforcing regulations on crypto companies through legal action. "Sometimes we need to take enforcement actions to bring people back to the right side," he said.
Under Gensler’s leadership, the SEC has filed numerous lawsuits against crypto companies for violating securities laws. Defendants include major centralized exchanges such as Coinbase, Binance, and Kraken, as well as the fintech company Ripple, the issuer of the XRP token. The SEC, however, has refused to establish clearer regulatory guidelines or criteria for determining whether a cryptocurrency falls into one of two categories: a security or a commodity. In assessing the future of cryptocurrencies, Gensler struck a blow to the digital industry by citing Gresham's Law: "Bad money drives out good."
● It's certainly disheartening when cryptocurrencies are labelled as "the worst," and crypto advocates are described as being on "the wrong side." However, in the US, it's not only authorities that can file lawsuits against commercial organisations— the reverse is also possible. And they can even call the SEC an "illegal entity." In a bold move, the cryptocurrency exchange Crypto.com has filed a lawsuit against the SEC, accusing the agency of overstepping its authority in regulating the crypto industry. This was announced by the co-founder and CEO of the platform, Kris Marszalek.
"This unprecedented action by our company against a federal agency is a justified response to the SEC's enforcement measures, which have harmed more than 50 million American cryptocurrency holders," he wrote on his social media page. According to Marszalek, the Commission has overreached its legal boundaries and now operates as an unlawful entity, labelling almost all cryptocurrencies as securities. The Crypto.com CEO also promised that the company would use "all available regulatory tools" to bring clarity to the industry and protect the future of the crypto sector in the US through legal means.
● Continuing with the topic of the US Securities and Exchange Commission (SEC), here's another development. Following in the footsteps of Bitwise, the crypto investment firm Canary Capital has filed an application with the SEC to launch a spot XRP-ETF based on Ripple. The idea behind this exchange-traded fund is to give investors access to one of the largest altcoins through a traditional brokerage account, without the risks associated with directly buying and storing cryptocurrency. And this is good news.
The application was submitted using Form S-1, which means there are no specific deadlines by which the regulator must make a decision. And that's the bad news: knowing Gary Gensler’s stance, the review process could range from "just a long time" to "endlessly long." Additionally, a second mandatory step in launching the ETF is the submission of another application—this time by the stock exchange where the new product will be listed. As of now, the SEC has not received such a filing from any exchange.
● The outcome of the US presidential elections could significantly impact the crypto industry. Geoff Kendrick, Head of Crypto Research at Standard Chartered Bank, predicts that if Donald Trump is elected, the price of bitcoin could triple by the end of 2025, and Solana could rise fivefold. Kendrick believes that the Trump administration would be more favourable towards the Solana ecosystem compared to a Harris administration. Therefore, if Kamala Harris becomes the occupant of the White House, bitcoin is expected to outpace Ethereum in growth, while Ethereum would surpass Solana and reach $7,000. Kendrick also suggests that bitcoin could rise to $200,000 by the end of 2025, regardless of the election results on 5th November.
● Currently, both bitcoin and Ethereum are under pressure. Bitcoin, the world's largest cryptocurrency, faces speculation about a potential sale of a large number of tokens held by the US government, although no decision has been made yet. According to analysts at QCP Capital, the rising demand for meme coins is also hindering BTC's growth. As for Ethereum, its price could be negatively impacted by the Chinese authorities, who are reportedly preparing to sell $1.3 billion worth of Ethereum seized from employees of the cryptocurrency company PlusToken.
● At the time of writing this review, on the evening of Friday, 10th October, the BTC/USD pair is trading around $63,080, the ETH/USD pair at $2,460, and SOL/USD at $146.0. The total cryptocurrency market capitalisation has remained relatively unchanged, standing at $2.20 trillion (compared to $2.17 trillion a week ago). The Bitcoin Crypto Fear & Greed Index has dropped from 41 to 32 points, placing it in the Fear zone.
● And finally, an event that could turn into another global sensation. Renowned economist Tyler Cowen has nominated Ethereum co-founder Vitalik Buterin for the Nobel Prize in Economics. This initiative was supported by another prominent expert, Professor Alexander Tabarrok. Both economists praised Buterin for his significant contributions to the monetary economics of cryptocurrencies, emphasising that his work has far surpassed that of any other economist. According to Tyler, Vitalik built the brilliant Ethereum platform and created a digital currency that challenges Mises' Regression Theorem. This theorem asserts that the value of money can be traced back ("regressed") to the value of the goods and services it represents.
Cowen and his colleague also commended Buterin's continued efforts to develop the Ethereum network and highlighted that he would make an excellent speaker at the Nobel Prize ceremony (if he is approved), noting his politeness and good communication skills.
For reference: Vitalik Buterin was born near Moscow in 1994, meaning he is currently 30 years old. At the age of 6, he moved with his parents from Russia to Canada. He is the co-founder and former editor of *Bitcoin Magazine* and the co-founder of the Ethereum project, for which he won the World Technology Award in 2014, beating out Facebook founder Mark Zuckerberg and other contenders. In 2021, Buterin became the youngest cryptocurrency billionaire in the world. American *Forbes* estimated Buterin's net worth at $1.3 billion.


NordFX Analytical Group

Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.

Forex and Cryptocurrency Forecast for October 07 – 11, 2024

EUR/USD: Dollar Breaks Through



● For seven weeks, the EUR/USD pair remained in a sideways trend, lacking strong drivers, confined within the 1.1000-1.1200 range, and on Friday, 4th October, it once again approached the lower boundary of this channel. The main factor influencing this movement was the behaviour of the US Dollar Index (DXY). Calculated by ICE, the DXY rose due to increased demand for safe-haven assets. Concerns over the escalation of the Middle East crisis led to the largest weekly rise in oil prices since 2023, and the US dollar, as a safe-haven currency, became the best-performing G10 currency over a 5-day period. The US currency was also supported by encouraging economic data from the United States. According to the Institute for Supply Management (ISM) report, the country's Services PMI jumped from 51.5 to 54.9 points in September, marking the highest level since February 2023.
● However, the most important event of the week was expected to be the US labour market data, traditionally published on the first Friday of every month. As reported by the Bureau of Labour Statistics (BLS) on 4th October, the number of new jobs in the non-farm sector (NFP) increased by 254K. This figure followed a rise of 159K recorded in August and significantly exceeded market expectations of 140K. The unemployment rate dropped to 4.1% from 4.2% (forecast 4.2%), and instead of the expected decline in annual wage inflation to 3.3%, it actually rose to 4.0% (from 3.9% in the previous month).
● When making decisions on monetary policy, the US Federal Reserve always takes two key indicators into account: the state of the labour market and inflation. The current BLS report showed: 1) the resilience of the economy (since the number of new jobs is increasing and unemployment is falling, the economy is clearly on the rise), and 2) inflation growth. Based on this, market participants concluded that the Fed may not rush with further easing of its policy (QE).
Had the employment data been poor, it would have strengthened market expectations that the FOMC (Federal Open Market Committee) would cut the key interest rate by 50 basis points (bps) at its November meeting. However, now this probability has sharply decreased. Moreover, during his speech at the annual meeting of the National Association for Business Economics (NABE) in Nashville on Monday, 30th October, Fed Chair Jerome Powell noted that the FOMC is "not the kind of committee that rushes to lower rates quickly." "If the economy performs as expected, that would mean two more rate cuts this year, both by a quarter of a point," the head of the US central bank stated.
● Against this backdrop, the US Dollar Index (DXY) surged to 102.69, and the EUR/USD pair, for the first time in many days, broke through the 1.1000 support and found a local bottom at 1.0950. The final note of the week was struck at 1.0974. Expert opinions on the future behaviour of EUR/USD in the near term provided no clear direction. About 20% of analysts supported the strengthening of the dollar and the pair's decline, another 20% predicted its weakening, and the majority (60%) took a neutral stance. In the medium term, the number of votes favouring dollar growth increases to 70%. In technical analysis on D1, all 100% of oscillators are in red, though a quarter of them signal the pair is oversold. Among trend indicators, 65% recommend selling, and 35% suggest buying.
The nearest support for the pair is located in the 1.0950 zone, followed by 1.0890-1.0925, 1.0780-1.0805, 1.0725, 1.0665-1.0680, 1.0600-1.0620, 1.0520-1.0565, and 1.0450-1.0465. Resistance zones are at 1.1000-1.1010, followed by 1.1045, 1.1100, 1.1155, 1.1185-1.1210, 1.1275, 1.1385, 1.1485-1.1505, and 1.1670-1.1690, 1.1875-1.1905.
● In the upcoming week's event calendar, Monday, 7th October stands out with the release of retail sales data from the Eurozone. Wednesday, 9th October is of interest due to the publication of the minutes from the latest FOMC meeting. The second half of the week promises to be more eventful. On Thursday, 10th October, in addition to the usual US unemployment data, we will learn what is happening with consumer inflation (CPI) in the United States. On Friday, Germany's CPI figure will be published first, and by the end of the five-day workweek, we can expect the release of another important inflation indicator – the US Producer Price Index (PPI).

CRYPTOCURRENCIES: The Mystery of Satoshi Nakamoto to be Revealed on 9th October

● Graphic analysis is somewhat reminiscent of the work of artists – each one sees something different when observing the same subject. A month ago, we shared how an analyst under the nickname Rekt Capital predicted a surge in the price of the first cryptocurrency in October, identifying a "bull flag" pattern on the BTC/USD chart. Another analyst, MetaShackle, based their forecast on the "cup and handle" pattern. This prediction was also described in detail by us. Peter Brandt, head of Factor LLC, recently made a forecast based on graphic analysis as well. This well-known analyst and trader suggested that by 2025, the bitcoin-to-gold ratio could increase by more than 400%. He based his highly optimistic forecast on another classic model – the "inverse head and shoulders."
And now, the same Peter Brandt, a Wall Street legend, has spotted not a head, but... blind mice. And not just one or two, but three, which seems to have deeply unsettled him. "A distinct 'three blind mice' pattern can be seen on the bitcoin chart," Brandt wrote. "It points to a further decline in price, so don't expect a bullish rally in October." According to him, the increase in bitcoin trading volumes alongside falling prices indicates that, amidst rising geopolitical tensions, institutional investors prefer to avoid risk and are quickly exiting the market, shifting to gold (and to the dollar, we might add). Brandt noted that in just one day at the beginning of October, over $240 million was withdrawn from US spot BTC-ETFs, the largest outflow in recent months.
It's worth mentioning that the "three blind mice" pattern also implies the presence of a "piece of cheese" these creatures are aiming for. Unfortunately, Brandt didn’t reveal where this cheese might be hidden. However, one could guess it's somewhere below the $60,000 support level. But as long as this level holds, there’s still a chance the mice will regain their sight and retreat, noticing the "bull flag," the "cup and handle," and the "inverse head and shoulders." Once they retreat, the leading cryptocurrency could take off.
● Analyst and Forbes contributor Jesse Colombo, much like Peter Brandt, has concluded that bitcoin has failed to live up to its reputation as a "safe haven" during times of global turmoil. Colombo points out that amidst escalating international tensions and the conflict between Israel and Iran, bitcoin, unlike gold, has once again disappointed investors who sought to use it as a hedge against risks.
"If bitcoin were truly 'digital gold,' it should have risen during periods of geopolitical upheaval, not declined," Colombo stated. "Bitcoin behaves like a speculative, high-risk asset, similar to shares of 'hot' tech companies, rather than as a safe-haven asset. This is evident from how closely bitcoin's price chart tracks the tech-heavy Nasdaq-100 index. Data from the last five years shows a striking correlation coefficient between the two – 0.88 [close to the maximum of 1.00], confirming their strong connection," the Forbes analyst concluded.
● Of course, the negative forecasts of Brandt and Colombo are well-founded. However, as noted by analysts at QCP Capital, the escalation in the Middle East only caused a moderate correction in the cryptocurrency market – bitcoin fell by just 4%, without breaking through the $60,000 level. QCP Capital does not rule out that further conflict escalation could lead to a decline in the price of "digital gold" to $55,000, but the asset is expected to recover from the drop. According to the specialists, BTC is currently supported by two factors: 1) The policy of the People's Bank of China, which aims to stimulate domestic demand amidst a slowdown in the national economy; 2) The initiation of monetary easing (QE) cycles and interest rate cuts by the central banks of major developed countries, primarily the US Federal Reserve.
According to QCP Capital's forecast, bitcoin is sure to demonstrate a bull rally, although its Dominance Index may dip slightly. Historically, October has been associated with a rise in this cryptocurrency’s price. QCP Capital analysts have calculated that over the last nine years, bitcoin has risen in October eight times, with an average increase of 22.9%. If this happens again, it could push the price above $75,000, marking new all-time highs.
● Another interesting observation was made by Markus Thielen, founder of 10x Research. He noted that since the summer, after the release of data on business activity (PMI) in the US manufacturing sector, the crypto market has experienced a pullback of around 10%. "Now, manufacturing activity is declining again," the analyst wrote, "and it may shrink even further due to the dockworkers' strike that began on 30th September in several of the largest ports in the US. This will negatively affect the crypto sector as well." "Forecast indicators have dropped to a level close to recessionary," Thielen predicted. "If the PMI falls below 48.0, it will trigger another bitcoin decline, while a higher figure could fuel a rally." His forecast was accurate. While the market was expecting a reading of 47.5, the September manufacturing PMI actually dropped to 47.2 points. The data was released on Tuesday, 1st October, and that very day the BTC/USD pair showed a red candle on the chart, declining by approximately 6%. Of course, this could be a coincidence. Or it could be a pattern discovered by the founder of 10x Research.
Additionally, according to him, uncertainty in the crypto market is heightened by the potential for another key interest rate hike by the Bank of Japan as part of its ongoing tightening policy (QT).
● And, of course, a major factor generating a lot of speculation around the crypto market is the US presidential election. A survey conducted in the US by Harris Poll, with financial support from Grayscale, showed that over 56% of voters are more likely to vote for a presidential candidate who supports the crypto industry. According to the survey results, nearly 40% of voters now pay attention to a candidate's stance on digital assets (in December 2023, this figure did not exceed 34%). At the same time, nearly 45% of cryptocurrency holders believe that the Democratic Party is more favourable to the industry (with Kamala Harris as the presidential candidate), while 42% pointed to the Republicans (with Donald Trump as the candidate).
A similar poll conducted by crypto exchange Coinbase and Morning Consult showed that the votes of digital asset holders are split evenly: 47% support Kamala Harris, and another 47% back Donald Trump. Despite some discrepancies with the Harris Poll data, the results of both surveys clearly indicate that crypto investors will be an important group that could influence the outcome of the US presidential election on 5th November.
● Expert and founder of Eight and MN Trading, Michael Van De Poppe, believes that by the end of 2024, the price of the leading cryptocurrency will reach a record high of $192,000. He suggests that the BTC market is currently in a "perfect storm" situation. Rising social tensions in many countries, declining trust in traditional financial institutions, and geopolitical conflicts are driving investors towards assets like bitcoin and other cryptocurrencies.
According to the expert, as central banks lower interest rates and increase liquidity to stimulate economic growth, price increases for assets such as physical and digital gold are inevitable in the medium term. The exponentially growing US national debt and further rate cuts by the Federal Reserve will become strong catalysts for cryptocurrency price growth. Van De Poppe believes that in the next cycle, bitcoin's price could reach anywhere between $300,000 and $600,000.
● As for bitcoin's main competitor, Ethereum, in our previous review titled "ETH Is No Longer the King of Altcoins. Long Live the New King?" we provided statistics showing how Solana (SOL) is surpassing the leading altcoin in terms of capital inflow. We won't claim that our publication was the reason, but the co-founder and former CEO of the crypto exchange BitMEX, Arthur Hayes, refuted it in a recent interview, stating that "Ethereum is the unassailable king of altcoins."
"It seems that Ethereum will never stop," he wrote. "The emergence of Layer 2 solutions has reduced transaction costs and accelerated transaction processing on the network. This increases Ethereum's competitiveness and gives it advantages over other networks. [...] Therefore, no other blockchain will be able to surpass it." The ex-CEO of BitMEX praised the Solana network for its user interface and active community. However, according to him, the SOL coin significantly lags behind Ethereum in market capitalization ($67 billion versus $294.5 billion). Furthermore, Hayes believes that for any blockchain to overtake ETH, developers must introduce new and original technology beyond its network.
● According to Ryan Lee, Chief Analyst at Bitget Research, the price of ETH in October could range between $2,200 and $3,400. Among the key factors influencing the asset’s price, Lee highlighted the Federal Reserve's interest rate cuts. He noted that once this rate aligns with Ethereum's staking yield, currently at 3.5% per annum, ETH will once again become an attractive investment tool. Thus, a reduction in interest rates will positively impact the coin's value.
Another bullish factor is the release of EigenLayer (EIGEN) tokens and their subsequent listing on exchanges. This could trigger an influx of additional capital into the ecosystem, helping ETH outpace bitcoin and Solana (SOL) in price growth. As a third growth factor, Ryan Lee pointed to the renewed excitement around meme tokens. According to him, there is currently an increase in meme-based digital assets on the Ethereum network, such as Neiro (NEIRO). High demand for these coins will attract new users and boost the popularity of the ETH network.
● As of the time of writing this review, on the evening of Friday, 4th October, the BTC/USD pair is trading around $62,400, while the ETH/USD pair is at $2,430. The total cryptocurrency market capitalization has declined to $2.17 trillion (down from $2.32 trillion a week ago). The Crypto Fear & Greed Index has dropped from 61 to 41 points, swiftly moving past the Neutral zone and shifting from the Greed zone directly into the Fear zone.
● And finally, an event that promises to become a global sensation. Next week, on 8th-9th October, the American TV channel HBO will air a documentary in which the creators claim to have identified the real Satoshi Nakamoto! "The revelation could send shockwaves through global financial markets and even impact the US presidential elections, given how the Republican candidate and former president Donald Trump has gained the support of bitcoin enthusiasts," the filmmakers stated.
Well, we'll see. Don't forget to turn on your TV and have some calming pills ready – just in case it turns out to be a real information bomb!


NordFX Analytical Group

Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.

CryptoNews

– A survey conducted in the US by Harris Poll, with financial support from Grayscale, revealed that over 56% of voters are more likely to vote for a presidential candidate who supports the crypto industry. According to the survey results, almost 40% of voters now pay attention to a candidate’s stance on digital assets (in December 2023, this figure did not exceed 34%). Additionally, nearly 45% of cryptocurrency holders believe that the Democratic Party, represented by presidential candidate Kamala Harris, is more favourable to the industry, while 42% indicated support for the Republicans, with candidate Donald Trump.
Analysts also noted that the growing interest in virtual currencies is linked to the launch of spot BTC-ETF and ETH-ETF trading. Nearly 30% of those surveyed by Harris Poll stated that these new products increased their interest in investing in digital assets. Around 46% expressed a desire to add cryptocurrencies to their investment portfolios.
A similar survey, conducted by the crypto exchange Coinbase and Morning Consult, showed that votes among digital asset holders were evenly split: 47% supporting Kamala Harris and another 47% backing Donald Trump. Despite some discrepancies with the Harris Poll data, the results of both surveys clearly indicate that crypto investors will become an important group capable of influencing the outcome of the US presidential election on 5 November.

– October has historically been associated with a rise in bitcoin’s price. Analysts at QCP Capital have calculated that over the past nine years, the leading cryptocurrency has increased in value eight times during October, with an average growth of 22.9%. If this pattern repeats itself, it could drive BTC above $78,000, marking new all-time highs. Currently, bitcoin is consolidating within the $60,000–$70,000 range, sparking speculation about a potential bullish breakout, possibly influenced by the upcoming US presidential election. Additionally, analysts have noted that the inflow of funds into spot BTC-ETFs has remained consistently positive for the eighth consecutive day, reflecting a similar trend to Q1 of this year. On Monday, 1 October alone, these funds saw inflows exceeding $61 million.

– Markus Thielen, the founder of 10x Research, noted that since the summer, following the release of data on business activity (PMI) in the US manufacturing sector, the crypto market has seen a decline of approximately 10%.
"Manufacturing activity is once again declining," writes the analyst, "and it could decrease further due to the dockworker strikes that began on 30 September at several of the largest ports in the US. This will negatively impact the crypto industry." Thielen added, "Forecast indicators have dropped to levels close to recessionary territory. If the PMI falls below 48.0, it could trigger a further decline in bitcoin, while a higher figure could lead to a rally." Additionally, Thielen pointed out that uncertainty in the crypto market is further exacerbated by the potential increase in the key interest rate by the Bank of Japan as part of its ongoing policy of tightening (QT).

– Financial strategists at one of the world’s largest banks, JPMorgan, have stated that flagship cryptocurrencies such as bitcoin can be useful for diversifying an equity portfolio. In their [controversial] opinion, digital assets have minimal correlation with traditional market assets. Therefore, JPMorgan believes they can provide effective risk hedging. "Reallocating a stock portfolio and adding 1% of total assets to cryptocurrencies could be an effective strategy for improving investment efficiency and overall portfolio returns, adjusted for risk," the bank's strategists commented. By investing such a small portion of assets in BTC, an investor would not suffer significant losses even if the price of the flagship cryptocurrency were to drop sharply. On the other hand, an increase in bitcoin’s market value amidst a decline in commodity and raw materials investment instruments could reduce overall losses. However, JPMorgan economists point out that their recommendations apply specifically to the aforementioned markets and are less effective in the currency markets, for instance, in pairs with the dollar or yen.
Previously, Matt Hougan, Chief Investment Officer at Bitwise, remarked that leading financial advisors are increasingly recommending that their clients invest in cryptocurrencies. Although, in our view, their advice for investors to hold just 1% in bitcoin is hardly a bold or revolutionary move.

– The Chinese authorities have issued the first-ever crypto licence to ZA Bank. This makes the company the first digital bank in Hong Kong, a special administrative and economic region of China, to be permitted to conduct cryptocurrency operations. The decision, which allowed the bank to enter this market, was made following a year-long discussion with mainland Chinese regulators and Hong Kong's Securities and Futures Commission (SFC). Previously, ZA Bank had announced that, upon receiving the licence, it would be ready to serve companies issuing their own stablecoins and to open custody accounts for crypto assets.

– Michael Saylor, the founder of MicroStrategy, the largest private holder of bitcoin, shared a chart illustrating the price changes of his company's stock, BTC, and the S&P 500 index. Since MicroStrategy made its first bitcoin purchase in August 2020, the company’s assets have appreciated by 1,325%. During the same period, bitcoin’s price increased by only 451%, while the S&P 500 rose by "just" 71%.
As a result, MicroStrategy's shares have outperformed the leading cryptocurrency by nearly three times in profitability and have exceeded the performance of companies in the S&P 500 by more than 18 times. Since the start of this year alone, MicroStrategy’s shares have risen by 152%. At the end of September, the company raised an additional $2.1 billion to buy more bitcoin, bringing its holdings to 252,220 BTC, or 1.3% of the total supply.

– According to Ryan Lee, the Chief Analyst at Bitget Research, the price of ETH in October is expected to range between $2,200 and $3,400. Among the key factors influencing the asset's price, the expert highlighted the reduction of the US Federal Reserve's key interest rate. Lee stated that once this rate aligns with Ethereum's staking yield, currently at 3.5% per annum, ETH will once again become an attractive investment tool. Therefore, a decrease in the interest rate will positively affect the coin's value.
Another factor is the release of EigenLayer (EIGEN) tokens and their subsequent listing on exchanges. This could attract additional capital into the ecosystem, potentially enabling ETH to outpace bitcoin and Solana (SOL) in terms of price growth. As a third growth factor, Lee pointed to the resurgence of interest in meme tokens. He noted that there is currently an increase in the number of meme-based digital assets on the Ethereum network, such as Neiro (NEIRO). High demand for these tokens is likely to attract new users and boost the popularity of the ETH network. However, the expert did not rule out the possibility of a sharp decline in the cryptocurrency’s value, potentially dropping to $2,200 (it is currently trading at around $2,550).

– Michael Van De Poppe, an expert and founder of the companies Eight and MN Trading, believes that by the end of 2024, the price of the leading cryptocurrency will reach a record $192,000. He suggests that the BTC market is currently experiencing a "perfect storm." Rising social tensions in many countries, a decline in trust toward traditional financial institutions, and a weakening labour market in the US are pushing investors to turn to assets like bitcoin and other cryptocurrencies.
According to Van De Poppe, as central banks reduce interest rates and increase liquidity to stimulate economic growth, a medium-term rise in the prices of assets such as physical and digital gold is inevitable. The exponentially growing US national debt and further rate cuts by the Federal Reserve will serve as powerful catalysts for the cryptocurrency’s price growth. Van De Poppe predicts that in the next cycle, bitcoin's price could reach between $300,000 and $600,000.


NordFX Analytical Group

Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.

Top 3 NordFX Traders Earned Over $60,000 in September

The brokerage company NordFX has summarised the trading performance of its clients for September 2024. Additionally, the social trading services and the profits earned by the company’s IB partners were evaluated.

● The highest profit in the first month of autumn was earned by a client from Southeast Asia, account No. 1509XXX. Using the major pair EUR/USD, they managed to make 26,664 USD. 
– The second place on the September podium was taken by a trader from East Asia (account No. 1543XXX), who earned 17,477 USD through trading the gold pair XAU/USD. 
– Precious metals also benefited a representative from South Asia (account No. 1767XXX), who entered the TOP-3 in September with a profit of 16,603 USD.   

● In CopyTrading, we continue to monitor the signal Quiet_trade_USD. It started at the very end of February this year and has been showing steady growth ever since. The profit for this signal is approaching 17%, which is several times higher than the interest rates on bank deposits in USD. Regarding the drawdown, there was a slight "dip" of 15.4% almost at the start, on 3rd April, which the signal's author successfully managed. Since then, the drawdown has not exceeded 5%. Of course, it is important to remind that past performance does not guarantee future results. Therefore, as always, we urge investors to exercise maximum caution when investing their money.

● The TOP-3 IB partners of NordFX in September are as follows: 
– The highest commission, 25,113 USD, was awarded to a partner from South Asia, account No. 1678XXX. It is worth noting that this partner periodically ranks among the top three. For example, last month, they secured 2nd place with a result of 27,244 USD. 
– Second place was taken by their fellow countryman (account No. 1576XXX), who earned 18,935 USD. 
– Finally, closing the TOP-3 is another partner from South Asia (account No. 1593XXX), who received 14,467 USD as a reward.


NordFX Analytical Group

Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.

Forex and Cryptocurrency Forecast for September 30 – October 04, 2024

EUR/USD: Midpoint of the 'Dull Period'

● In the next part of the review, we will discuss how one crypto analyst used the term "dull period" in relation to the BTC/USD chart. The EUR/USD chart looks even more uneventful. While from 20 August until today, the pair fluctuated within the 1.1000-1.1200 range, last week it narrowed by another 50%, from 200 points to 100, settling in the 1.1100-1.1200 range. It appears the market has already priced in the forecasts for the US Federal Reserve rate cut, the actual moment of the cut on 17-18 September, and expectations regarding future monetary policy from both the US and European Central Banks.
● Of course, the pair's dynamics were influenced by events listed in the economic calendar. On Monday, 23 September, preliminary data on business activity (PMI) across various sectors of the economies of Germany, the Eurozone, and the US were released. On the European side of the Atlantic, PMI figures were uniformly in the red, indicating that business activity in both the manufacturing and services sectors is declining. The data was especially disheartening for Germany’s manufacturing sector, the engine of the European economy. Not only did it fall below the threshold of 50 points, which separates progress from regression, but it also reached a low of 40.3 points. In the US, manufacturing PMI also declined, but not as dramatically as in Germany, dropping from 47.9 to 47.0 points. As for the American services sector, it remained firmly in the green zone, standing confidently at 55.4 points.
● The data released on Thursday, 26 September, also indicated an expansion of the US economy. While GDP growth in Q1 stood at 1.6%, by the end of Q2, this figure had risen to 3.0%. Alongside GDP growth, the labour market showed a degree of stability. Instead of the forecasted rise to 224K, the number of initial jobless claims for the week actually fell from 222K to 218K. On the same day, market participants closely listened to statements by Fed Chair Jerome Powell and his ECB counterpart Christine Lagarde, but nothing new or sensational was announced.
As for inflation, a key indicator such as the Core Personal Consumption Expenditures (PCE) Price Index, which reflects price changes for a fixed basket of consumer goods and services purchased by US residents, increased year-on-year from 2.6% to 2.7%. However, on a monthly basis, it fell from 0.2% to 0.1%. These figures were released on Friday, 27 September.
● Against the backdrop of this PCE decline, the EUR/USD bulls made another attempt to push the pair to 1.1202, but once again, they failed to hold their ground. The final note of the trading week sounded in the middle of the channel at 1.1163.
● Expert opinions on the short-term behaviour of EUR/USD are divided as follows. During this "dull period," 40% of analysts are voting for a stronger dollar and a decline in the pair, while the majority (60%) have taken a neutral stance, and none are predicting growth. However, in the medium term, the number of those expecting the pair to rise increases to 30%. In terms of technical analysis on D1, 80% of trend indicators recommend buying, while 20% suggest selling. The oscillators show a more mixed picture: 25% are green, 25% are red, and the remaining 50% are in a neutral grey zone. The nearest support levels for the pair are around 1.1100, followed by 1.1000-1.1025, 1.0880-1.0910, 1.0780-1.0805, 1.0725, 1.0665-1.0680, and 1.0600-1.0620. Resistance zones are found around 1.1185-1.1210, 1.1275, 1.1385, 1.1485-1.1505, 1.1670-1.1690, and 1.1875-1.1905.
● The upcoming week promises to be quite eventful, interesting, and volatile. On Monday, 30 September, preliminary data on consumer inflation (CPI) in Germany will be released. On the same day, Federal Reserve Chairman Jerome Powell is set to give a speech. The following day, Tuesday, 1 October, the CPI figures for the Eurozone as a whole will be announced. Additionally, on 1 and 3 October, revised data on business activity (PMI) in various sectors of the US economy will be revealed. Furthermore, from 1 to 4 October, a wave of labour market statistics from the United States will flood in. The main focus will be on Friday, 4 October, when key figures such as the unemployment rate and the number of new jobs created outside the agricultural sector (NFP) will be published.

CRYPTOCURRENCIES: Is the 'Dull Period' Coming to an End?



● In terms of technical analysis patterns, the launch of BTC-ETFs earlier this year led to the formation of a "flagpole" on the total cryptocurrency market capitalisation chart. Then, starting from 13 March, the flag's "body" began to take shape in the form of a fairly wide descending channel. A nearly identical pattern appeared on the BTC/USD chart. Thus, the market capitalisation peaked on 13 March at $2.77 trillion, while bitcoin recorded its all-time high (ATH) of $73,743. Six and a half months have passed since then, and the current capitalisation stands at $2.32 trillion, with bitcoin’s weekly local high reaching $66,517.
● The research firm Glassnode believes that the market is stuck in a consolidation phase due to a lack of capital. Glassnode notes that short-term speculators, holding cryptocurrency for less than 155 days, are selling more coins than they are buying. On the other hand, CryptoQuant highlights that after the early August low, when the leading cryptocurrency dropped below $49,000, even short-term holders are now "in profit." Analysts point out that the risk of large-scale bitcoin sales is currently at its lowest level since the beginning of 2024. "Over the past six months, the number of people willing to sell bitcoin has dropped to a minimum," they write. "The sell-risk ratio, which sums up all realised profits and losses on the network per day and divides this by bitcoin's realised capitalisation, is now below 20,000. For comparison, during the March peak, this figure reached nearly 80,000."
● It is worth noting that the last time such an extended consolidation period was observed in the digital gold market was four years ago. It occurred after the end of a powerful bull rally in Q2 2019 and lasted until September 2020. Following this, there was a fivefold price increase, with bitcoin reaching a new ATH of $58,783. Drawing a parallel to that period, many market participants are now hoping for a similar surge after the current accumulation phase by buyers concludes.
The analyst known by the pseudonym PlanB has stated that the current consolidation suggests that another explosive price increase is only a matter of time. He also points out that similar "dull" periods occurred not only in 2019 but also earlier. After such phases, in 2013, 2017, and 2020, we witnessed significant price movements. PlanB further emphasised that throughout bitcoin's history, spanning 162 months, only 27 of them (about 16.7%) have shown growth, yet that growth amounted to hundreds of thousands of percent.
● Analysts at 10x Research have identified two catalysts for a sharp rise in bitcoin. In their view, the triggers for a bull rally will be the US Federal Reserve’s interest rate cuts and the upcoming payouts to creditors of the bankrupt crypto exchange FTX. "The expected influx of $5-8 billion will excite investors," the experts suggest.
Moreover, they believe there is "a likelihood of a sharp, 'juicy' rise in cryptocurrency, as the Fed appears to have raised the level of the S&P 500 at which it will intervene to protect investors, signalling the possibility of further rate cuts. As a result, many investors will likely reposition their portfolios into risk assets by 2025," according to the 10x Research report.
● According to Bloomberg, following the Fed's rate cut at the 17-18 September meeting, the correlation between the crypto market and the US stock market neared a record high. The 40-day correlation coefficient between the 100 largest cryptocurrencies and the S&P 500 index reached approximately 0.67. (A higher mark of 0.72 was only achieved once, in Q2 2022). As a result, US stock indices (S&P 500, Dow Jones, and Nasdaq) reached new highs, while bitcoin approached the upper boundary of the "flag body" pattern.
● While 10x Research identified two reasons for bitcoin’s potential growth, Bernstein has counted as many as five. 1. Fed Rate Cuts and Inflation Hedging: Analysts note that bitcoin, like gold, becomes more attractive during times of fiscal excess, especially as US debt approaches $35 trillion. Since the beginning of the year, bitcoin has risen by 45%, compared to gold's 27% increase. 2. Growing Bipartisan Support for Cryptocurrencies: This is highlighted by statements from both Donald Trump and Kamala Harris, reflecting the increasing acceptance of crypto across political lines.
3. Popularity of Bitcoin ETFs: "In the past 10 days, inflows into bitcoin ETFs have reached $800 million, despite volatile price dynamics," Bernstein reports. The firm expects more banks, such as Morgan Stanley, to launch bitcoin ETFs, leading to further capital inflows. 4. Miner Stability After April's Halving: According to Bernstein, the network's hash power has recovered, indicating miner resilience and further strengthening bitcoin's fundamentals. 5. Decreased Selling Pressure: Large bitcoin sales by the US and German governments, as well as payouts to Mt. Gox creditors, have been absorbed by the market. Moreover, MicroStrategy has managed to raise $2.1 billion to purchase more bitcoin, bringing its holdings to 252,220 BTC, or 1.3% of the total supply.
● Bitget Research also highlights MicroStrategy's actions and the increased inflow of funds into bitcoin ETFs following the Fed's rate cuts. "This indicates that institutional players are optimistic about the market's prospects. With steady purchases, bitcoin is likely to break through previous highs," Bitget Research experts note. Additionally, they believe that the regulatory framework in the US is likely to undergo significant changes after the presidential elections in November, creating a favourable environment for investment in the crypto industry. Investor confidence in the market will grow, which will facilitate capital inflow and accumulation.
● Undoubtedly, political factors have a significant impact on the crypto market. Recently, the positive dynamics of bitcoin and leading altcoins were supported by a statement from Vice President Kamala Harris, who said that if she wins the US presidential election, she will promote increased investment in AI technologies and the cryptocurrency sector. Some experts have called Harris’s statement "encouraging" and "an important event for crypto and blockchain technologies." However, others, such as venture capitalist Nic Carter, have expressed the opposite view, claiming that Harris's words are politically motivated and "mean nothing." Charles Hoskinson, founder of Cardano and co-founder of Ethereum, also believes that none of the US presidential candidates will be able to create favourable conditions for the industry, as they lack the necessary knowledge of cryptocurrencies.
● Macroeconomist Raoul Pal expects bitcoin's price to soar to $200,000 or more by the start of next year. He identifies the primary driver for this as the easing of monetary policy by the Federal Reserve and other major central banks. In a video posted on his Real Vision channel, the former Goldman Sachs executive explained that the leading cryptocurrency tends to rise and fall along with global liquidity cycles. He presented a chart of the GMI (Global Macro Investor) index, which reflects an increase in global liquidity over the next three months, and analysed how this would impact BTC's price.
Pal also prepared another chart showing that BTC is exactly replicating its price movement from January 2023 to March 2024, when the price surged by approximately 350%, from $16,500 to nearly $74,000. According to the economist, "bitcoin is repeating what it did last year, almost exactly. So, we have the macro-overlay, the Fed will continue [easing], other central banks will also get involved. We have seasonality and the global liquidity cycle..." "This should happen now," Raoul Pal concludes. (The seasonal factor was also noted by analysts at 10x Research, who pointed out that historically, bitcoin has shown significant growth from October to March, and this trend could repeat, considering previous market cycles).
● Returning from fundamental to technical analysis, let’s recall some of the predictions based on chart patterns that we've previously discussed. About a month ago, the analyst known as Rekt Capital predicted a surge in the value of the leading cryptocurrency in October. His forecast was based on the "bull flag" pattern, which we mentioned at the beginning of this review, where the breakout height equals the height of the flagpole’s base. Another analyst, MetaShackle, relies on the "cup and handle" pattern. This forecast, which we detailed from 2-6 September, is another bullish chart formation that has been developing over the last three years. According to MetaShackle’s calculations, this pattern should lead the BTC/USD pair to rise to $130,870.
Recently, analyst and Factor LLC head Peter Brandt also referred to chart analysis in his forecast. The Wall Street legend believes that in 2025, the bitcoin-to-gold ratio could increase by more than 400%. Justifying his highly optimistic prediction, Brandt points to a classic technical model: the "inverse head and shoulders" pattern. This pattern forms under a resistance level called the neckline. The theory states that when resistance is broken, accompanied by rising trading volumes, the price climbs by the maximum distance between the neckline and the deepest point of the head.
Applied to the BTC/XAU chart, the price of 1 bitcoin could reach the equivalent of 123 ounces of gold by 2025, which is five times higher than the current 24.6 ounces as of 27 September 2024. In other words, assuming physical gold remains at its current level of $2,670, the price of digital gold, according to Brandt’s theory, could soar to over $328,000. Supporting the idea that bitcoin could surpass the precious metal is its rapid adoption by institutional investors, as well as the launch of bitcoin ETFs, which have increased the asset's presence in their portfolios.
● At the time of writing this review, on the evening of Friday, 27 September, the BTC/USD pair is trading in the $65,900 zone. The total cryptocurrency market capitalisation has increased by $220 billion, reaching $2.32 trillion (compared to $2.10 trillion a week ago). The Crypto Fear & Greed Index has risen from 54 to 61 points, moving from the Neutral zone to Greed. This trend supports the words of UFC fighter Renato Moicano, who urged the public to pay more attention to the leading cryptocurrency. "Bitcoin is not just an investment. It's a way of life," said the Brazilian, demanding that his prize for winning UFC 300 be paid in BTC.

CRYPTOCURRENCIES: ETH is No Longer the King of Altcoins. Long Live the New King?

● Despite the "dull period," the last three months have seen significant shifts in trends within the crypto market. Metrics show that among the 15 largest altcoins, Solana (SOL) has recorded the highest inflow of funds and continues to show steady growth. SOL's price has risen to $150, with a market capitalisation of around $69 billion and a trading volume of $2.34 billion. On the other hand, Ethereum has struggled, even with the title of the #1 altcoin. It has been unable to hold above $2,650 or surpass a market capitalisation threshold of $320 billion. The well-known blockchain has ceded its position to newer networks, registering the largest capital outflow since 13 March: more than $165 billion, a 33% decrease.
Solana has also faced losses. After reaching a peak of $203 in March, its value gradually declined, now standing at about $150. However, analysts at the investment firm VanEck foresee a bright future for SOL, predicting growth to $330. They base their forecast on the fact that Solana's blockchain outperforms Ethereum’s network in three key areas: 1. Solana's blockchain can process 31 times more transactions per second; 2. SOL's network is used by 14 times more people daily; 3. The cost of processing transfers on Solana's blockchain is significantly lower.

NordFX Analytical Group

Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.

CryptoNews



– According to Bloomberg, the correlation between the cryptocurrency market and the US stock market has reached near-record levels. This occurred following the Federal Reserve’s decision to lower the key interest rate at its meeting on 17-18 September. The 40-day correlation coefficient between the 100 largest cryptocurrencies and the S&P 500 index stands at approximately 0.67. A higher value (0.72) was reached only once, during Q2 2022.
Following the start of the Federal Reserve’s monetary easing, US stock indices (S&P 500, Dow Jones, and Nasdaq) hit new highs, and on 23 September, bitcoin reached $64,765. Such a high direct correlation indicates that cryptocurrency prices are heavily dependent on macroeconomic indicators and the actions of the Federal Reserve.
Political factors also undoubtedly influence the cryptocurrency market. For instance, the positive trend in bitcoin and leading altcoins in recent days was supported by a statement from Vice President Kamala Harris, who said that, if elected President of the United States, she would promote increased investment in AI technologies and the cryptocurrency sector. Some experts have called Harris’s statement “encouraging” and “an important event for crypto and blockchain technologies.” However, others, such as venture capitalist Nic Carter, expressed the opposite view, claiming that Harris’s words are politically motivated and “mean nothing.”

– Charles Hoskinson, the founder of Cardano and co-founder of Ethereum, believes that none of the US presidential candidates has a sufficient understanding of cryptocurrencies. For this reason, in Hoskinson's view, they will be unable to create favourable conditions for industry companies in the US. Donald Trump’s record-high staff turnover will prevent him from bringing the right people into government to foster the development of digital assets. Meanwhile, if Kamala Harris wins, she will continue Joe Biden’s anti-cryptocurrency policies. Hoskinson believes that local elections are far more important, as crypto companies can work more closely and effectively with senators.

– The Chinese government imposed a total ban on cryptocurrencies back in 2021. Beijing strictly limited the use of digital assets, prohibiting offshore exchanges from offering their services in the country. Authorities also banned all forms of cryptocurrency mining. Despite this, bitcoin miners from China still control a significant share of the global market. According to Ki Young Ju, the founder and CEO of CryptoQuant, over 55% of bitcoin’s hashrate is under the control of Chinese mining pools.
“Chinese mining pools manage 55% of the network, while American pools account for around 40%. US pools mainly serve institutional miners, whereas Chinese pools cater to smaller miners from Asia,” stated Ki Young Ju. Given this situation, the Chinese authorities’ stance on cryptocurrency could become even stricter. In 2025, the government plans to introduce amendments to its anti-money laundering (AML) regulations, extending them to cryptocurrency transactions.

– Analysts at 10x Research have identified two catalysts for a sharp rise in bitcoin. In their view, the trigger for a bull rally will be the US Federal Reserve’s interest rate cuts and the upcoming payments to creditors of the bankrupt cryptocurrency exchange FTX. "The expected inflow of $5-8 billion will encourage investors," the experts believe.
Moreover, they suggest that "there is a chance of a sharp, ‘juicy’ rise in cryptocurrency, as the Federal Reserve appears to have raised the S&P 500 level at which it will intervene to protect investors, signalling the potential for further rate cuts. As a result, many investors are likely to reposition their portfolios into riskier assets by 2025," states the 10x Research report.
The analysts also point out that, historically, bitcoin has shown significant growth from October to March, and a similar trend could repeat, considering the previous market cycles of 2021 and 2017.

– According to Bernstein, there are as many as five reasons behind bitcoin's growth. 1. Federal Reserve rate cuts and inflation hedging. Analysts note that, like gold, bitcoin becomes more attractive during times of fiscal excess, especially when US debt reaches $35 trillion. Since the beginning of the year, bitcoin has risen by 45%, compared to gold's 27% increase. 2. Growing bipartisan support for cryptocurrencies, accompanied by statements from Donald Trump and Kamala Harris. 3. The popularity of exchange-traded bitcoin ETFs. “Over the past 10 days, inflows into bitcoin ETFs have reached $800 million, despite volatile price movements,” Bernstein notes. The company expects that more banks, like Morgan Stanley, will also launch bitcoin ETFs, leading to further capital inflows. 4. Stability among miners after the April halving. According to Bernstein, network hashrate has recovered, indicating miner resilience, which further strengthens bitcoin's foundation. 5. Decreased selling pressure. Large sales of bitcoin by the US and German governments, as well as payments to Mt. Gox clients, have been absorbed by the market. Additionally, MicroStrategy has managed to raise $2.1 billion to purchase the leading cryptocurrency, bringing its holdings to 252,220 BTC, or 1.3% of the total supply.

– Legendary trader, analyst, and head of Factor LLC, Peter Brandt, believes that in 2025, the bitcoin-to-gold ratio could rise by more than 400%. To justify his highly optimistic forecast, Brandt refers to a classic technical model – the "inverse head and shoulders." The pattern forms below resistance, known as the neckline. In theory, when resistance is broken, accompanied by rising trading volumes, the price increases by the maximum distance between the neckline and the deepest point of the head.
Applied to the BTC/GLD chart, the price of 1 bitcoin could reach the price of 123 ounces of gold as early as 2025, which is a 400% increase compared to 24 ounces as of 22 September 2024. This means that if physical gold remains at its current level of $2,630, the price of digital gold, according to Brandt’s theory, could soar to over $323,000. Supporting the idea that bitcoin could outperform the precious metal is its rapid adoption by institutional investors, as well as the launch of exchange-traded BTC ETFs, which have strengthened the asset's presence in their portfolios.

– One of the early bitcoin developers, Jeff Garzik, has created the Hemi Network protocol to connect the Bitcoin and Ethereum blockchains through tunnels. Cross-chain protocols (bridges) already exist and also serve to transfer assets between incompatible networks. However, the Hemi team claims that tunnels create a unique environment, allowing Bitcoin and Ethereum to "coexist" while avoiding the vulnerabilities inherent to bridges. Currently, the Hemi Network test is live, with the mainnet launch scheduled for Q4 of this year.

– Speaking at the TOKEN-2049 conference in Singapore, Jess Houlgrave, CEO of fintech company Reown (formerly WalletConnect), stated that in six years, cryptocurrency wallets will completely disappear and transform into "life centres." According to her, these will become universal digital archives where users can store not only digital assets but also a wide range of documents, from medical records to educational diplomas. The company’s head noted that the security of such archives will become much more reliable in a few years, allowing users to use them without fear of hacking.

– A few days ago, UFC fighter Renato Moicano called on the public to pay more attention to the first cryptocurrency. The Brazilian has repeatedly stated that bitcoin has long-term potential, serves as an alternative to traditional money, and can protect citizens from rising inflation. Given the economic uncertainty, including concerns around the US dollar, digital gold is becoming the best option for preserving savings. "Bitcoin is not just an investment," Renato Moicano said. "It's a way of life." (It’s worth noting that after his victory at UFC 300, the fighter publicly demanded that his reward be paid in BTC.)

– Macroeconomist Raoul Pal believes that everything is aligned for bitcoin's price to soar to $200,000 or more by the beginning of next year. In a video posted on his Real Vision channel, the former Goldman Sachs executive explained that the leading cryptocurrency tends to rise and fall in tandem with global liquidity cycles. He presented a chart of the GMI (Global Macro Investor) index, which shows an increase in global liquidity over the next three months, and analysed how this will impact BTC's price.
Pal also shared another chart showing that BTC is precisely repeating its price movement from January 2023 to March 2024, when the price surged by approximately 350% from $16,500 to $74,000. According to the economist, "Bitcoin is repeating what it did last year, almost exactly. So, we have the macro overlay, the Fed will continue [easing], other central banks will get involved as well. We have seasonality and the global liquidity cycle..." "This has to happen now," Raoul Pal concludes.

Forex and Cryptocurrency Forecast for September 23 – 27, 2024

EUR/USD: Rate Drops, Dollar Falls



● The United States Federal Reserve System (Fed) announced its decision on the benchmark interest rate following the two-day meeting held on September 17-18. The intrigue lay in the rate cut step—whether it would be the standard 25 basis points (bps) or twice as much. On the eve of the meeting, according to market expectations, the probability of a 25 bps decrease was 45%, and a 50 bps decrease was 55%. As a result, for the first time in four years, the regulator opted to reduce the rate by half a percent immediately: from the highest in 23 years of 5.50% to 5.00%. 
● It should be noted that at the beginning of the easing of monetary policy (QE), such a large rate cut was applied by the Federal Reserve relatively rarely and only in critical situations. For example, in this century, this occurred in 2001 (following the attack on the World Trade Center in New York), in 2007 (the onset of the economic crisis), and in 2020 (the COVID-19 pandemic). However, such a force majeure event is not currently observed, so why did the American central bank take this step?
Several analysts explain this by stating that the Fed was delayed in lowering the rate in July and is now striving to catch up. (Recall that several members of the FOMC [Federal Open Market Committee] were ready to start cutting rates as early as mid-summer.) Fed Chair Jerome Powell did not agree with the version of a delay. On the other hand, he acknowledged that if the labor market data in July had been released before rather than after the FOMC meeting, the decision could have been different.
The current September meeting was also notable because, for the first time since 2005, the Fed's decision was not unanimous. One of the 12 FOMC members, Michelle Bowman, publicly advocated for a 25 bps rate cut instead of 50 bps.
● The Fed's updated macroeconomic forecasts, following the September 17-18 meeting, suggest a faster decline in inflation and higher unemployment rates. Jerome Powell referred to this as a shift in the balance of risks.
According to the new forecast, inflation (PCE index) this year will be 2.3% (June forecast was 2.6%), next year – 2.1% (June was 2.3%), and finally in 2026, inflation will decrease to the target of 2.0% (unchanged). In 2027 and beyond, inflation rates will remain at the target level.
As for the unemployment forecast in the United States, it has been raised for 2024 from 4.0% to 4.4%, in 2025 it is expected to remain at 4.4% (June was 4.2%), and in 2026 to decrease to 4.3% (June was 4.1%). The Fed expects that starting in 2027 and onward, unemployment will hold steady at 4.2%.
The forecast for US GDP growth in 2024 has been lowered from 2.1% to 2.0%, with the same figure planned for 2025-2027, which is overall above the long-term trend of 1.8%.
● The regulator also announced that interest rate cuts will continue. However, due to changes in inflation and labor market forecasts, the rate outlook has been significantly softened. Thus, the Fed plans to see the rate at 4.5% by the end of the year (i.e., possibly two more cuts: in November and December by 25 bps each). In the one-year perspective, the rate is expected to be 3.4%, and then 2.9%.
It is important to understand that these are only forecasts, which can (and will) change depending on the geopolitical situation in the world and the internal situation in the United States. For example, experts expect a serious increase in the budget deficit in the event of Donald Trump coming to the White House. This could seriously slow the pace of QE.
● Regarding the euro, the pan-European currency has recently been supported by statements from high-ranking EU officials. For example, ECB Vice-President Luis de Guindos stated last week that “we have left the door completely open, […] and in December we will have more information than in October.” These words are an obvious hint that the regulator does not intend to make any rate decisions before December. ECB Governing Council member and Governor of the Bank of Lithuania, Gediminas Šimkus, also tempered market expectations by stating on Tuesday, September 17, that “the probability of a rate cut in October is very low.” “In October, we will not have much new data. And the economy is developing according to forecasts,” he added.
Currently, the ECB's key interest rate stands at 3.65%. Thus, if the difference between the Fed's and the ECB's (and other central banks') interest rates narrows by the end of this year and throughout the next year, it will put pressure on the dollar. Meanwhile, the market reaction to the Fed's September decision was quite subdued. Of course, forecasts for further rate cuts helped risk assets. The stock indices S&P 500, Dow Jones, and Nasdaq continued to rise, and leading cryptocurrencies improved their positions. Conversely, the Dollar Index (DXY) fell. The EUR/USD pair, being inversely correlated with it, first rose to 1.1188, then fell to 1.1080, showing maximum weekly volatility of 108 points. Then the fluctuations began to diminish, the waves gradually subsided, and the pair ended the workweek at 1.1162.
● Expert opinions regarding EUR/USD's behaviour in the near term are divided as follows: only 20% of analysts voted for a strengthening dollar and a decline in the pair, 65% for its growth, and another 15% took a neutral position. However, when moving to a medium-term forecast, the picture changes sharply. Here, 65% are on the side of the US currency, predicting the pair to fall below 1.1000. Supporters of the euro in this time horizon are only 20%, while 15% still remain neutral, refusing to make forecasts. In technical analysis on the D1 chart, all 100% of trend indicators and oscillators are colored green, although a quarter of the latter are signalling overbought conditions. The nearest support for the pair is located in the zone 1.1135-1.1150, then 1.1100, 1.1000-1.1025, 1.0880-1.0910, 1.0780-1.0805, 1.0725, 1.0665-1.0680, 1.0600-1.0620. Resistance zones are in the regions of 1.1185-1.1200, 1.1275, 1.1385, 1.1485-1.1505, 1.1670-1.1690, and 1.1875-1.1905.
● This upcoming week, the dynamics of major dollar pairs EUR/USD, GBP/USD, and USD/JPY may be significantly influenced by the following events. On Monday, September 23, preliminary Purchasing Managers' Index (PMI) data will be released for various sectors of the economies of Germany, the Eurozone, the United Kingdom, and the United States. Following a brief pause in the flow of important economic news, on Thursday, September 26, the US GDP data for the second quarter and the number of initial jobless claims in the country will be published. Additionally, scheduled for this day are the hearing of the inflation report in the UK Parliament and a speech by Federal Reserve Chair Jerome Powell. At the very end of the workweek, on Friday, September 27, inflation data for the Tokyo region (Japan) will be released. Moreover, on this day, we will receive another set of inflation statistics from the United States in the form of the Core Personal Consumption Expenditures (PCE) Price Index. Traders dealing with yen pairs should also note that Monday, September 23, is a holiday in Japan, as the country observes the Autumnal Equinox Day.

GBP/USD: Rate Unchanged, Pound Rises

● Last week, two more central bank meetings took place: the Bank of England (BoE) on Thursday, September 19, and the Bank of Japan (BoJ) on Friday, September 20. As a result of the former, the British pound against the US dollar reached its highest level in the last 2.5 years. This occurred against the backdrop of the British regulator's decision to keep the key interest rate at the current level of 5.00% and to refrain from hasty measures to reduce it. Consequently, after the announcement of this decision, the GBP/USD pair rose to $1.3339 for the first time since March 2022.
● Despite the decline in UK government bond yields, markets have quickly adjusted their forecasts regarding further easing of monetary policy by the Bank of England (BoE). Currently, according to the median forecast, a rate reduction of 42 basis points is expected by the end of December, compared to the 50 basis points predicted before the last meeting. (Although, it is clear that this adjustment is minor and quite conditional). Macro strategists from the banking group Mizuho International believe that rate cuts will occur slowly, possibly once per quarter. In their view, against this backdrop, GBP/USD has the potential for further growth and could break the 1.3400 level as early as the beginning of October, with the pair reaching $1.4000 by the end of next year, 2025.
Thus, the pound has become the most successful currency among the G10 countries this year. Investors, although expecting a policy easing by the Bank of England in November, are confident that inflationary pressure in the country will remain sufficiently high, supporting relatively elevated interest rates compared to other economies.

USD/JPY: Rate Unchanged, Yen Falls

● Similarly to the Bank of England, the Bank of Japan (BoJ) decided to keep its key interest rate at the same level during its meeting. This decision was anticipated by market participants. However, while the Fed, ECB, and Bank of England are focused on the pace of rate cuts, markets expect the Japanese regulator to do the opposite – raise rates. Nonetheless, BoJ Governor Kazuo Ueda indicated during the press conference following the meeting that he does not plan to accelerate this process. Rates were already increased in March and July of this year, and now it is time to pause and assess the results achieved. Ueda emphasized that the Bank of Japan will continue to raise rates if economic and inflation indicators meet forecasts. However, the weakening of inflationary pressures due to the yen's softness provides the bank with the opportunity to adopt a more cautious approach to future decisions.
● After this statement, the Japanese yen sharply sold off, with the USD/JPY pair reaching a local high of 144.49. Futures on 10-year Japanese government bonds rose by nearly 30 basis points, and the Topix index, reflecting the state of Japan's stock market, showed a 1% increase.
Analysts around the world shared their opinions on the potential consequences of the BoJ's decisions. Experts from Saxo Markets write that “there is no sense of urgency in further normalization from the Bank of Japan. As long as Ueda maintains the same tone, Japanese stocks will enjoy the situation created by the sharp rate cut by the Fed.” In turn, Sumitomo Mitsui Bank believes that the likelihood of rate hikes in December remains low, as the weak yen supports the stock market, which stimulates wage growth.

CRYPTOCURRENCIES: "Bitcoin – the Best Buy in the World"

● Recently, Arthur Hayes, co-founder and former CEO of the crypto exchange BitMEX, compared the consequences of the Fed's interest rate cut for the US economy to the effect of a "sugar high," which can trigger a wave effect and a short-term upward rally. And the rate was cut, immediately by 50 basis points. Risk assets immediately experienced the promised high. The stock indices S&P 500, Dow Jones, and Nasdaq went up, followed by digital assets. To say it was a surge, a jump, or a rally would be an exaggeration. But, according to Hayes, "this is the calm before the storm." "Usually, it goes like this," he writes, "first there is an initial reaction, and the real reaction comes by the close of traditional financial markets on Friday, after which cryptocurrencies follow them—up or down—over the weekend." However, since this review is being written on Friday, we cannot yet verify the accuracy or inaccuracy of BitMEX's co-founder’s words.
● According to Arthur Hayes, the rate cuts amid the growing issuance of US dollars and increased government spending are a mistake for the global financial system but will allow cryptocurrencies to become more sought after by investors, as their yields will rise.
At BlackRock, the world's largest asset management company, it was noted that although it is difficult for investors to analyze cryptocurrencies compared to traditional assets, Bitcoin has nevertheless become a "safe haven" for many amid rising geopolitical tensions. BlackRock strategists note that the leading cryptocurrency could become an effective tool for protection against the ongoing devaluation of the US dollar and global financial risks. Additionally, according to their forecast, as BTC is adopted "as a global monetary alternative," its correlation with US company stocks and dependence on the Fed's rate will gradually decrease.
● Investment strategist and author of the bestseller "Broken Money," Lyn Alden, believes that the adoption of cryptocurrencies in society is not just fast, but rapid. And if Bitcoin remains the leader among digital assets and is considered a reliable store of value, its price in the next ten to eleven years could reach $1 million per coin.
Alden agreed with Ark Invest CEO Cathie Wood's forecast that the price of digital gold could rise to $1.5 million. However, according to the specialist, the timeframes forecasted by Wood are too aggressive. The head of Ark Invest believes that Bitcoin will reach values with six zeros as early as six years from now, by 2030. Alden, however, cites 2035 as the most likely date.
"Not buying bitcoins at this stage would be a crime," declares the author of Broken Money. According to her, "now bitcoin is the best buy on the global market, as this asset has long-term potential." Lyn Alden is confident that in the future, Bitcoin will surpass physical gold. (For reference: the market capitalization of this precious metal currently amounts to about $17 trillion, Bitcoin – $1.17 trillion, that is, 14.5 times less.)
● Let us recall that recently, Jack Dorsey, co-founder and former CEO of Twitter, made a similar statement, suggesting that BTC would reach $1 million by 2030. However, the most impressive forecast was given by MicroStrategy founder Michael Saylor, who stated that Bitcoin will soon increase in price … by 70 (!) times – to $3.85 million. In the long term, according to this billionaire, digital gold could rise to $13 million. However, this is expected to happen only by 2045. By 2050, Bitcoin's market capitalization will amount to 13% of the entire global capital. (For reference: currently, this figure stands at 0.1%).
● Returning from the year 2050 to 2024, let us highlight the forecast of WeRate co-founder Quinten Francois. His data indicate the imminent start of a bull rally. “The average Bitcoin cycle begins approximately 170 days after the halving, and the peak forms after 480 days,” he writes. Based on this, there is not much time left before the rally begins—the surge, according to Quinten Francois's chart, is expected to start on Tuesday, October 8. The analyst also believes that thanks to the Fed's rate decision, there is a possibility that BTC will quickly rise above $64,500. Consequently, during October-November, the coin's price could increase by at least 46%, reaching $90,000-95,000.
● A similar forecast was given by the CIO and founder of MN Trading Consultancy Michael van de Poppe. According to him, the growth of global liquidity will become the key catalyst for the next bull cycle in the digital market. “Cryptocurrencies and commodities are extremely undervalued,” writes van de Poppe, “and it is quite likely that they will enter a 10-year bull market. I expect significant growth from these two asset classes.” According to the expert, the leading cryptocurrency is already ready to rise to $90,000.
As a key support level for Bitcoin, Michael van de Poppe named $58,000. The probability of the price falling below $55,000, according to him, is practically zero. It is worth noting that earlier in September, ARK Invest analysts identified $52,000 and $46,000 as key levels. Meanwhile, the aforementioned Quinten Francois from WeRate believes that it is important for the asset to maintain positions above the critically important zone of $59,000.
● The easing of monetary policy by the Fed and other central banks should also help altcoins. According to analyst Vladimir Cohen, liquidity began to leave this sector in April, which is why fear reigned during the summer. However, the trend has now reversed, and reaching a historical market capitalization peak of $1.1 trillion is just a matter of time. A large amount of liquidity is expected to flow into this market due to the central banks' policy loosening. Furthermore, according to the specialist, some altcoins will demonstrate growth of thousands of percent, while others will ultimately die out. Cohen believes that removing coins that do not offer practical value will play a positive role, as it will make this segment more transparent and liquid.
● Vladimir Cohen also noted that altcoin holders have currently shifted to a long-term holding strategy, ready to endure temporary declines in value while anticipating a future rally. A similar trend is being observed with bitcoin by analysts at CryptoQuant. The available supply of bitcoin is decreasing as users withdraw coins for long-term holding without intending to sell. "Selling pressure is decreasing as fewer coins are available for trading. Some traders are depositing funds into derivative platforms to open long positions, betting on price growth," write the CryptoQuant analysts. However, they also believe that the BTC price is unlikely to undergo significant changes in the short term.
● As of the time of writing, on the evening of Friday, September 20, following the US Fed meeting, the BTC/USD pair moved upwards and is trading around the $62,840 zone. The total cryptocurrency market capitalization has risen slightly to $2.19 trillion (compared to $2.10 trillion a week ago). The Crypto Fear & Greed Index has also increased from 32 to 54 points, moving from the Fear zone into the Neutral zone.


NordFX Analytical Group

Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.

CryptoNews

– The decline in the price of bitcoin and other cryptocurrencies this week is most likely due to investors anticipating the upcoming decision by the US Federal Reserve regarding a rate cut. The announcement will be made following the conclusion of the meeting on 18 September.
However, as some analysts have noted, the timing of the price drop also coincides with reports of another assassination attempt on Donald Trump. It is worth mentioning that this former (and possibly future) US president positions himself as a supporter of cryptocurrencies and has promised to turn the US into the "world capital of bitcoin and cryptocurrencies".

– The stablecoin Tether (USDT) can already be considered one of the key elements of the global financial system. Statistics have shown that in 2023, the volume of transactions and the network’s profitability reached the same levels as Visa. The only difference is that Visa processes transactions through credit cards in traditional currency, while Tether occupies a similar niche in the crypto sphere. Moreover, Tether surpassed BlackRock, the world’s largest asset management company, in profit by $700 million. All of this not only reflects the volume of USDT usage but also the role this stablecoin has come to play in global financial operations.
For reference: According to Token Terminal, over the past two years, USDT's market share has grown by more than 20%. The asset now controls over 75% of the entire stablecoin market. In Q1 2024, Tether earned more than $4.5 billion in profit. In just the last 30 days, Tether made around $400 million.

– According to WeRate co-founder Quinten Francois, current data indicates the imminent start of a bull rally for the leading cryptocurrency. "The average bitcoin cycle begins approximately 170 days after the halving, with the peak forming after 480 days," he writes. Based on this, there is not much time left before the rally starts – according to Francois's calculations, the surge should begin on Tuesday, 8 October.
The analyst believes that it is crucial for the asset to hold its position around the critically important support zone of $59,000. With the US Federal Reserve meeting, the second half of this week will be extremely significant. Francois predicts that there is a possibility BTC could rise above $64,500. If this happens, the coin's price may increase by at least 46% over the course of October-November.

– Michaël van de Poppe, CIO and founder of MN Trading Consultancy, believes that major economies will soon be forced to begin the process of refinancing their debt obligations. As a result, the increase in global liquidity will become a key catalyst for the next bull cycle in the digital market. "Cryptocurrencies and commodities are highly undervalued," van de Poppe writes, "and it is very likely that they will enter a 10-year bull market. I expect significant growth from these two asset classes."
According to the expert, the leading cryptocurrency is already primed for growth after a decline that has lasted more than three months. BTC could rise to $90,000, having tested the key support level of $58,000. Van de Poppe considers the likelihood of the price falling below $55,000 to be almost zero. (It’s worth noting that earlier in September, analysts at the American company ARK Invest identified $52,000 and $46,000 as key support levels for bitcoin).

– According to analyst Vladimir Cohen, liquidity began to exit the altcoin sector in April, which led to a summer marked by fear across this market. However, the trend has now reversed, and reaching a new all-time high in market capitalisation of $1.1 trillion is just a matter of time. A significant influx of liquidity into the sector is expected due to the easing policies of central banks. In Cohen's view, some altcoins will experience growth of thousands of percent, while others will die out completely. He believes that the exit of coins that lack practical value will have a positive impact, making the sector more transparent and liquid.
Cohen also highlighted that the correlation between altcoins and bitcoin has weakened, with altcoins no longer experiencing significant price drops during bitcoin's dumps. This, according to the expert, suggests that investors have shifted into a long-term holding mode and are prepared to weather the dips in asset prices.

– The analyst known as Rekt Capital believes that bitcoin's growing dominance will deal a serious blow to altcoins. On the weekly chart, the market share of the leading cryptocurrency has consolidated above 57.68% for the first time since April 2019. Five years ago, after this threshold was crossed, an upward trend emerged, during which BTC dominance reached 71%, writes Rekt Capital.
This time, bitcoin’s position in the overall cryptocurrency market capitalisation has been strengthening for the past 210 days, despite BTC losing nearly 14% of its value over the past six months. As a result, bitcoin’s share of the total market capitalisation of digital assets has grown at the expense of falling altcoin prices. If this trend continues and BTC dominance rises, the prices of many alternative tokens are likely to drop.
However, the analyst known as Cryptollica has a different view. He believes that bitcoin's dominance will peak at 58% before collapsing to 35% by mid-2025. In this scenario, the market would enter an "altcoin season," characterised by an explosive surge in the prices of these tokens.

– Speaking at the Ethereum Singapore 2024 conference, Vitalik Buterin discussed the risks posed by centralised organisations and highlighted the role of individual network participants. In his view, solo stakers are the primary key to the security of the entire blockchain. Buterin emphasised that although these stakers form a diverse group, which is almost impossible to coordinate, they reduce reliance on centralised entities and add an essential decentralised layer of protection to the Ethereum network.

– MicroStrategy, founded by Michael Saylor, plans to raise an additional $700 million to pay off debts and increase its bitcoin holdings. The funding scheme is not new. MicroStrategy will issue convertible bonds, which will be exchanged for the company's shares in 2028. These securities are likely to be in high demand among investors, as the value of the company’s assets has nearly quadrupled over the past year.
The convertible bonds will be sold exclusively to qualified institutional investors. Of the funds raised, MicroStrategy intends to spend $500 million to repay debt on existing bonds, while the remaining $200 million will be used to increase its BTC holdings. Currently, MicroStrategy leads the ranking of private companies in terms of investments in "digital gold," holding 244,800 coins valued at approximately $14 billion. The average purchase price was $38,781 per 1 BTC.

– In August, the International Monetary Fund (IMF) once again recommended that the government of El Salvador abandon the integration of digital currencies into the country's economy and reconsider its policy towards the flagship cryptocurrency. However, it seems that such pressure has only fuelled El Salvador's leadership's desire for financial independence. Recently, President Nayib Bukele announced that the government plans to combat the budget deficit and its reliance on IMF loans by developing the crypto sector. To create a favourable investment climate, work is already underway to establish a network of private crypto banks, which will provide investors, including international ones, access to bitcoin transactions with fewer restrictions compared to traditional banks.
It is worth recalling that El Salvador became the first country in the world to make bitcoin legal tender on 7 September 2021. As of the end of August, the country’s crypto reserves amounted to 5,870 BTC. Additionally, 474 coins have been mined using geothermal energy.

– Unlike El Salvador, the Central Bank of Russia views cryptocurrencies and stablecoins as one of the main risk factors for the economy. In its financial market development project, the Russian Central Bank states that, due to the lack of global regulation, the use of cryptocurrencies and stablecoins in trade settlements could increase sharply. While some countries are taking steps to reduce the "destabilising role of cryptocurrencies," these efforts are insufficient, given the cross-border nature of digital coins. National economies must take measures to mitigate the risks posed by modern digital monetary substitutes and prevent them from gaining a dominant position over national currencies, according to the Russian Central Bank.

– The Madras High Court in India has prohibited the freezing of bank accounts belonging to crypto investors. The court emphasised that investigative authorities are required to notify account holders and the courts of such actions, though these requirements are often not followed. The Madras Court has been receiving numerous petitions to unfreeze the bank accounts of cryptocurrency owners, indicating law enforcement's inability to adequately explain the reasons for such blockages to account holders.
Earlier, Australian Senator Andrew Bragg described the freezing of bank accounts of companies and individuals using cryptocurrencies as a violation of antitrust laws. According to the senator, this does not resemble an effective approach to combating money laundering and the financing of terrorism through cryptocurrencies.

Forex and Cryptocurrency Forecast for September 16 – 20, 2024

EUR/USD: Storms and Tempests on September 18, 19, and 20



● The past week can be divided into two parts – from September 9 to 11, and from the 12th to the 13th. Initially, the dollar strengthened, then it lost ground. The trend shift occurred after data released on Wednesday, September 11, indicated a slowdown in US inflation and the labour market.
According to the US Department of Labor's report, consumer prices (CPI) in August rose by an average of 2.5% year-on-year, the lowest figure since February 2021. By comparison, the annual inflation rate in July was 2.9%. Thus, in just a month, the rate of consumer price growth slowed by 0.4%. It’s worth noting that the country's annual inflation rate has been declining for several months. For instance, by the end of July, CPI growth had already fallen to its lowest since March 2021. And although 2.9% is not yet the target 2.0%, it’s a far cry from the 9.1% seen two years ago. The light at the end of the tunnel is becoming visible. The same cannot be said for the labour market. Let’s recall that the Bureau of Labor Statistics report on September 6 showed that the number of new jobs created outside the US agricultural sector (Non-Farm Payrolls) was only 142K, compared to the expected 164K. The number of initial unemployment claims, published on September 12, was also somewhat disappointing. With a previous figure of 228K and a forecast of 227K, the number actually rose to 230K. The difference is small, of course, but the trend is still negative.
The market reacted to all this data in a very logical way. Before its release, the probability of a 25 basis point (bps) cut in the federal funds rate at the FOMC (Federal Open Market Committee) meeting of the US Federal Reserve on September 17-18 was 87%. Afterward, it dropped to 55%. Meanwhile, the chances of a 50 bps cut jumped from 13% to 45%. The thinking goes: the economy needs saving, and the fight against inflation can wait. However, we still believe that the Fed will exercise caution and start with a quarter-point cut rather than half a percent.
● On the news mentioned above, the EUR/USD pair was unable to break through the 1.1000 support level. After wavering near it, the pair reversed and moved upwards. While the market's reaction to the US Department of Labor's statistics was logical, the euro's strengthening following the European Central Bank (ECB) meeting is harder to explain.
On Thursday, the ECB resumed its monetary easing cycle (QE), which had been paused in July. The key interest rate was lowered from 4.25% to 3.65%, a cut of 0.6%. Why 0.6% and not a round 0.5% remains a mystery. But this is not the main point. What matters is that such a move should have weakened the euro. Yet, the opposite happened. The reason for this is likely ECB President Christine Lagarde, who, at the post-meeting press conference, did not give the slightest hint that the QE cycle could continue in October.
Despite the possible inflation slowdown in September, a rise is forecast towards the end of the year. The ECB expects inflation to be at 2.5% by the end of 2024, 2.2% in 2025, and only below the target 2.0% at 1.9% by the end of 2026. So why continue cutting rates so drastically when they are already quite low? Christine Lagarde even admitted that while the June cut had been planned in advance, the decision to ease monetary policy at the July meeting was, in fact, deemed hasty.
After Madame Lagarde's speech, the futures market reduced the likelihood of further ECB monetary easing in October from 40% to 20%, which led to the rise in EUR/USD. Derivatives now expect the US Federal Reserve to lower rates by 25 basis points 10 times over the next 12 months, while only 7 similar moves are expected from the ECB. This could lend strength to the bulls on this pair.
● As a result, the EUR/USD closed the past week at 1.1075, almost exactly where it began. Experts’ opinions on its short-term performance are divided as follows: 25% of analysts support a stronger dollar and a decline in the pair, 50% favour its rise, while the remaining 25% maintain a neutral position. However, the medium-term outlook paints a different picture. Here, 70% are in favour of the US dollar, while only 30% are against it.
In technical analysis on D1, the trend indicators show an overwhelming majority supporting the bulls, with 80% in the green camp and 20% siding with the bears. Among oscillators, the picture is more mixed: 25% are green, 40% are red, and the remaining 35% are neutral (grey).
The nearest support for the pair is in the 1.1000-1.1025 zone, followed by 1.0880-1.0910, 1.0780-1.0805, 1.0725, 1.0665-1.0680, and 1.0600-1.0620. Resistance zones are located around 1.1100, then 1.1135-1.1150, 1.1190-1.1200, 1.1240-1.1275, 1.1385, 1.1485-1.1505, 1.1670-1.1690, and 1.1875-1.1905.
● As for the upcoming week, the calendar will be packed with important economic events that will undoubtedly lead to increased volatility. On Tuesday, September 17, US retail sales data will be released. On Wednesday, September 18, key inflation indicators such as the Consumer Price Index (CPI) for the UK and the Eurozone will be made public. On the same day, the US Federal Reserve's FOMC will announce its decision on interest rates. Following the Fed meeting, similar meetings will be held by the Bank of England (BoE) on September 19 and the Bank of Japan (BoJ) on September 20. Naturally, besides the specific decisions, traders and investors will pay close attention to the statements and comments from the heads of these three central banks regarding future monetary policy.

CRYPTOCURRENCIES: Will the New US President Decide BTC's Fate?

● In our mid-week crypto market review, we were pleased to report some positive news from the analytics service Coinglass. According to their data, September 9 marked the end of the longest phase of capital outflows from US spot BTC-ETFs. The capitalisation of these funds had been declining since August 26, resulting in a loss of $1.2 billion. However, on Monday, September 9, bitcoin ETFs managed to attract $28.6 million in capital, breaking the streak of losses. But... the celebration was premature. By Wednesday, US-traded spot bitcoin funds recorded another outflow, ending the brief two-day inflow period, with losses totalling $43.97 million.
And here’s a bit more data: according to CryptoQuant, there has been a notable shift in bitcoin ownership dynamics over recent months. Short-term holders (those owning BTC for 155 days or less) have significantly reduced their positions, especially in July and August. Meanwhile, long-term holders have been increasing their holdings. Due to this redistribution, whales now control nearly 67% of the circulating supply of bitcoin and over 43% of ethereum reserves.
● Is this good or bad? Overall, the statistics seem rather contradictory. "The fact that short-term holders are not accumulating positions may indicate weak demand for bitcoin," notes CryptoQuant. However, they also suggest that the capital flow from weak hands (short-term holders) to strong hands (long-term holders) could set the stage for a potential market recovery, as increased accumulation by HODLers may stabilise prices. Nevertheless, as analysts at Santiment point out, unless whales (the primary target of BTC-ETFs) start buying bitcoin again, a bullish rally is unlikely in the near term.
● Evaluating the current situation, Greg Cipolaro, head of research at Bitcoin New York Digital Investment Group, urged bitcoin holders to be patient. In his view, September is unlikely to bring any surprises in terms of price growth for the leading cryptocurrency. The key factor influencing BTC, according to Cipolaro, will be the upcoming US presidential election on November 4. He believes the outcome of the election will be a pivotal event for the entire crypto market, regardless of who wins. However, Cipolaro declined to predict whether Donald Trump or Kamala Harris would emerge victorious. The analyst is also convinced that factors such as employment data, inflation levels, and even changes in the Fed's interest rate at its September 17-18 meeting will not have a lasting impact on bitcoin’s price.
● Greg Cipolaro's colleagues at 10x Research disagree with him. They believe that a potential 50 basis point rate cut by the Federal Reserve could negatively impact bitcoin and other cryptocurrencies.
"A sharp rate cut is a sign of economic concern, not confidence," say analysts at 10x Research. In their view, a 50 bps reduction in borrowing costs may signal that the regulator is struggling to address an impending downturn in the labour market. They argue that the community's expectations for bitcoin's price increase may go unfulfilled, as there are no clear growth catalysts, and the Fed is focused on balancing its efforts between combating unemployment and inflation.
● With only a few days left until the Federal Reserve meeting, there’s still over a month until the US presidential election. On September 10, the first debate between presidential candidates Donald Trump and Kamala Harris took place. Although cryptocurrencies were not mentioned, the debate outcome negatively impacted the prices of major digital assets. Before the debate, Trump held a slight lead in prediction markets. For example, on Polymarket, his chances of victory were at 53%, compared to Harris's 46%. However, after the debate, both candidates' odds levelled out at 49%. On another prediction platform, PredictIt, the difference was more pronounced: Harris's chances rose to 56%, while Trump's fell to 47%.
Since Trump portrays himself as a supporter of cryptocurrencies, while Harris has not yet taken a clear stance, the shift in balance had a negative effect on bitcoin and other digital assets. After the debate, the price of BTC dropped by about 3%. However, it soon recovered, as verbal sparring is far from the final vote outcome.
● It’s worth noting that the rhetoric of the US presidential candidates is quite different. Trump promises that the US will become the "world capital of bitcoin and cryptocurrencies." In contrast, Harris's programme avoids any mention of virtual assets. Based on this, experts at Bernstein have outlined their forecast for the crypto market. According to their predictions, bitcoin could test the $80,000 to $90,000 range if Donald Trump wins, and the $30,000 to $40,000 range if Kamala Harris becomes the next president. "While some crypto industry leaders harbour hopes for a more constructive policy from Harris, we expect a significant difference between the two outcomes. A Harris victory would maintain the challenging regulatory environment that has stifled market growth in recent years," Bernstein stated.
Analysts at Matrixport have also released a forecast on bitcoin's price following the election results. In their view, bitcoin will continue to rise regardless of the voting outcome. Matrixport noted that during Donald Trump's presidency from 2016 to 2020, bitcoin grew by 1,421%. Under Joe Biden, from 2020 to 2024, BTC’s price increased by 313%. "Bitcoin can continue to thrive regardless of who wins the presidential election in November and takes the White House," Matrixport analysts wrote. They believe the next president is likely to have a greater impact on cryptocurrency market regulation than on bitcoin’s price itself.
● Amidst this uncertain backdrop, a statement from MicroStrategy founder Michael Saylor sounded like a balm for bitcoin enthusiasts. Saylor predicted that bitcoin will soon increase in value by 70 times—reaching a staggering $3.85 million. The billionaire explained his forecast by highlighting the technological superiority of the leading cryptocurrency over other assets and its annual returns. Since MicroStrategy began purchasing BTC in August 2020, the cryptocurrency has delivered an average annual return of 44% to investors. In comparison, the S&P 500 index has grown by around 12% per year over the past four years.
Saylor is also confident that the future belongs to HODLers (long-term investors), who will ultimately outperform traders focused on short-term price fluctuations. In the long term, the billionaire forecasts that bitcoin could reach $13 million, though this would only happen by 2045. By 2050, he predicts that bitcoin’s market capitalisation will account for 13% of the world’s total capital (for reference, it currently stands at just 0.1%).
● As of the evening of Friday, September 13, at the time of writing, the BTC/USD pair surged sharply after a weakening of the US dollar, reaching the $59,900-60,000 zone. The total crypto market capitalisation rose slightly above the psychologically significant $2.0 trillion level, now standing at $2.10 trillion (compared to $1.87 trillion a week ago). Bitcoin's Crypto Fear & Greed Index increased from 22 to 32 points, shifting from the Extreme Fear zone into the Fear zone.
● And in conclusion, since we began our review with statistics, we'll end it with them as well. Specialists from Gemini conducted a survey among 6,000 respondents from the USA, the UK, France, and Singapore and found that among digital asset owners, 69% are men and 31% are women. But that's not all. According to Date Psychology, it turned out that the majority of women (77%) consider cryptocurrency enthusiasts unattractive. They perceive only those who collect Funko figures (toys dedicated to characters from movies, comics, cartoons, etc.) as worse. Perhaps this is because women view digital assets as unserious and project this attitude onto the men who are involved with them.
The most attractive to the female respondents were men who prefer hobbies such as reading, learning foreign languages, and playing musical instruments. However, as other surveys show, women working in the crypto industry achieve great success and often hold higher positions than their male colleagues. Draw your own conclusions, gentlemen!

NordFX Analytical Group

Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.

CryptoNews

– The first debate between U.S. presidential candidates Donald Trump and Kamala Harris took place on 10 September. Although cryptocurrencies were not mentioned, the debate outcome had a negative impact on the prices of leading digital assets. Prior to the debate, Trump held a slight lead in prediction markets. For instance, on Polymarket, his chances stood at 53%, compared to Harris’s 46%. However, after the debate, both candidates’ odds equalised at 49%. On another prediction platform, PredictIt, the difference was more pronounced: after the debate, Harris’s chances rose to 56%, while Trump’s dropped to 47%.
Since Trump had positioned himself as a supporter of cryptocurrencies, while Harris had yet to clarify her stance on the matter, this shift in the balance negatively affected the price of bitcoin and other cryptocurrencies. Following the debate, the value of the flagship asset dropped by approximately 3%.

– Analysts at Matrixport have published a forecast regarding the price movement of the leading cryptocurrency following the outcome of the U.S. presidential election. In their view, bitcoin will continue to rise, regardless of the voting results. Matrixport reminded readers that during Donald Trump’s presidency from 2016 to 2020, bitcoin saw a growth of 1,421%. Under Joe Biden's presidency, from 2020 to 2024, BTC's price increased by 313%. “Bitcoin can continue to thrive regardless of who wins the presidential election in November 2024 and takes the White House,” Matrixport analysts wrote. In their opinion, the next president is likely to have a greater impact on the regulation of the cryptocurrency market in the country than on bitcoin’s price itself.

– Experts at Bernstein have outlined a potential scenario for the cryptocurrency market depending on the outcome of the U.S. presidential election. According to their forecast, bitcoin could test a range between $80,000 and $90,000 if Donald Trump wins, and between $30,000 and $40,000 if Kamala Harris becomes the occupant of the White House. “While some leaders in the crypto industry harbour illusions about Harris’s campaign and hope for more constructive policies, we expect a significant difference between the two political outcomes. A Harris victory will likely maintain the challenging regulatory environment that has stifled market growth in recent years,” Bernstein stated.
Analysts also reminded that the rhetoric of the U.S. presidential candidates differs greatly. Trump promises that the U.S. will become the "world capital of bitcoin and cryptocurrencies," whereas Harris’s campaign avoids any mention of digital assets.

– Specialists at Gemini conducted a survey among 6,000 respondents from the U.S., UK, France, and Singapore. The results showed that from 2022 to 2024, the proportion of cryptocurrency ownership among traders and investors in the U.S. and UK remained virtually unchanged, standing at 21% and 18%, respectively. In France, the figure increased from 16% to 18%, while in Singapore, it dropped from 30% to 26%.
Respondents highlighted the issue of cryptocurrency regulation. In the U.S. and UK, 38% admitted that they refrain from acquiring digital assets due to legislative complexities. A similar view was expressed by 32% of those surveyed in France and about 50% in Singapore. Among those who purchased cryptocurrencies, 38% did so to hedge against inflation risks.
The Gemini report also noted that the gender gap among crypto investors has become more pronounced compared to 2022. Currently, 69% of digital asset owners identify as men, while 31% identify as women.

– The U.S. Federal Bureau of Investigation (FBI) has published a report revealing that nearly 70,000 complaints regarding cryptocurrency fraud were registered in 2023. Losses suffered by American citizens increased by 45% compared to 2022, reaching a record $5.6 billion. Victims reported falling into criminal schemes predominantly involving bitcoin, ethereum, and the stablecoin USDT. The most vulnerable demographic group was older Americans aged over 60, who collectively lost around $1.6 billion.
The majority of claims were related to crypto investments, accounting for nearly 71% of the total losses, or approximately $3.96 billion. Around 10% of complaints involved calls from scammers posing as government representatives through call centres. Other common forms of fraud noted by the FBI included schemes involving credit cards, extortion, malware, and romance scams, often conducted via social media and dating apps.

– The Head of Research at Bitcoin platform New York Digital Investment Group, Greg Cipolaro, has urged bitcoin holders to remain patient. In his opinion, September is unlikely to bring any surprises in terms of price growth for the flagship cryptocurrency.
As the main factor influencing the BTC rate, the expert pointed to the upcoming U.S. presidential election on 4 November. According to him, the outcome of this event will be a turning point for the entire crypto market, regardless of who wins. However, Cipolaro refrained from making a prediction about whether Donald Trump or Kamala Harris would emerge victorious. The analyst is also convinced that factors such as employment data, inflation rates, and even changes to the Federal Reserve's interest rate will not have a lasting impact on bitcoin’s price.

– According to Coinglass, 9 September marked the end of the longest capital outflow phase from U.S. spot BTC-ETFs. The capitalisation of these funds began to decline on 26 August, during which they lost $1.2 billion. However, on Monday, 9 September, bitcoin ETFs attracted $28.6 million in capital, finally breaking the streak of losses.
It’s worth noting that this situation is not new. Since the start of BTC-ETF trading in the U.S. on 12 January 2024, the capitalisation of these derivatives has twice experienced seven consecutive days of decline (excluding weekends and holidays). This occurred from 24 April to 2 May and from 13 to 24 June, coinciding with a drop in the price of the leading cryptocurrency. Inflows into the funds have typically been accompanied by a significant rise in the digital asset’s value.

– Experts at 10x Research have noted that a potential 50 basis point interest rate cut, which could be announced following the U.S. Federal Reserve's meeting on 17-18 September, might negatively affect the price of bitcoin and other cryptocurrencies.
“A sharp rate cut is a sign of economic concern, not confidence,” the analysts believe. In their view, reducing borrowing costs by 50 basis points could indicate that the regulator is struggling to combat an impending downturn in the labour market. They also suggest that the community’s expectations of a rise in the price of the leading cryptocurrency may not materialise, as growth catalysts are absent and the Fed is focused on balancing support for the labour market with efforts to curb inflation.

– According to MicroStrategy founder Michael Saylor, bitcoin is set to increase in value by 70 times, reaching $3.85 million. He based his forecast on the technological superiority of the flagship cryptocurrency over other assets and its annual return. Since August 2020, when MicroStrategy began acquiring BTC, the cryptocurrency has delivered an average annual return of 44% to investors. By comparison, over the past four years, the S&P 500 index has grown by approximately 12% annually.
Saylor also claims that the recent capital outflow from Ethereum-based spot ETFs will only increase investor demand for bitcoin. He is confident that the future belongs to hodlers (long-term investors), who will outlast traders focused on short-term price fluctuations.
In the long term, the billionaire predicts that digital gold could rise to $13 million, although this is expected to happen by 2045. By 2050, bitcoin’s market capitalisation could account for 13% of global capital. For reference, it currently stands at around 0.1%.

– The prospects for the approval of a Solana ETF have become even more uncertain in recent months, largely due to the general difficulties facing the crypto market. Bloomberg analyst James Seyffart highlighted the challenges that a potential launch of these funds is facing. Specifically, he pointed out that a major obstacle is the fact that the U.S. Securities and Exchange Commission (SEC) has classified Solana as a security in various legal proceedings.
Sui Chung, CEO of Kraken subsidiary CF Benchmarks, recently stated that a Solana-based ETF may never materialise. The reason, he explained, is that there are currently no significant regulated markets for futures tied to this token. Comparing Solana with existing spot ETFs, Chung emphasised that bitcoin and ethereum were listed on CME, the world’s largest derivatives market, several years before the SEC approved their ETFs. Furthermore, futures for these two cryptocurrencies had no contract violations, making SEC approval almost inevitable.

Forex and Cryptocurrency Forecast for September 09 – 13, 2024

EUR/USD: Markets Await ECB and Fed Meetings



● If the US economy is growing, investors buy up dollars to invest in the US stock market. As a result, the DXY Dollar Index rises. But as soon as the dark shadow of an impending recession falls over the rosy picture, the countdown begins. Moreover, an economic slowdown signals to the Fed that it's time to ease monetary policy (QE) and lower interest rates.
The next Fed meeting is very soon: on 18 September. Back in July, several FOMC (Federal Open Market Committee) members were ready to vote for a rate cut. However, they left it unchanged, deciding to wait until early autumn and make a decision based on more up-to-date macroeconomic indicators. In fact, hardly any market participants doubt that the borrowing cost will be cut by 25 basis points. But what if the decision is postponed again? Or, conversely, the rate is cut by 50 basis points at once? The result will depend, among other things, on the data that Fed officials received last week.
● It seems that the US economy is not facing a deep recession. However, no spectacular surge should be expected either. Data released on 3 and 5 September showed that the Manufacturing PMI stood at 47.2 points, which is higher than the previous figure of 46.8, but below expectations of 47.5. This indicator remains below the key 50.0 threshold, which separates growth from contraction. The services sector, on the other hand, performed significantly better, with activity reaching 55.7 compared to the previous value of 55.0 and the forecast of 55.2.
As for the labour market, the number of initial jobless claims for the week fell from 223K to 227K (forecast 231K).
At the very end of the workweek, on Friday, 6 August, the US Department of Labor's Bureau of Labor Statistics report showed that the number of new jobs created outside the agricultural sector (Non-Farm Payrolls) increased by 142K, below the forecast of 164K but significantly higher than July’s figure of 89K. (It's important to note that the latter figure was revised downwards from 114K to 89K.) Unemployment in the US dropped to 4.2% last month from 4.3% in July.
Average hourly earnings in the private sector increased by 0.4% (m/m) in August compared to the previous month, reaching $35.21 per hour. Wage inflation rose to 3.8% from 3.6% in July.
● These figures did not provide any clear advantage to either bulls or bears. The recently released aggregate GDP data for the 20 Eurozone countries also had little impact on market sentiment. According to Eurostat, the Eurozone economy grew by 0.6% year-on-year in Q2, which was in line with both the forecast and the previous figure. On a quarterly basis, growth was 0.2%, compared to the forecast and the previous value of 0.3%.
● As a result, following the release of the US Department of Labor report on 6 September, the EUR/USD pair first hit a weekly high of 1.1155, then dropped to 1.1065, rose again, dropped once more, and ultimately finished the five-day period at 1.1085. Expert opinions on its short-term performance were divided as follows: 40% of analysts voted for a strengthening of the dollar and a decline in the pair, while 60% predicted its rise.
In technical analysis on D1, the majority of trend indicators favour the bulls, with 85% on the green side and 15% supporting the red. Among oscillators, 40% are painted green, 35% red, and the remaining 25% are neutral-grey.
The nearest support for the pair is located in the 1.1025-1.1040 zone, followed by 1.0880-1.0910, 1.0780-1.0805, 1.0725, 1.0665-1.0680, and 1.0600-1.0620. Resistance zones are found around 1.1120-1.1150, then 1.1180-1.1200, 1.1240-1.1275, 1.1385, 1.1485-1.1505, 1.1670-1.1690, and 1.1875-1.1905.
● As for the economic calendar, the upcoming week promises to be quite eventful. On Tuesday, 10 September, Germany's Consumer Price Index (CPI) data will be released. The inflation theme will continue the following day with the publication of the US CPI figures. On the same day, debates between US presidential candidates Kamala Harris and Donald Trump are scheduled.
On Thursday, 12 September, the European Central Bank (ECB) will hold a meeting to decide on interest rates and the overall direction of its monetary policy. Naturally, the press conference and comments from ECB leaders following the meeting will be of great interest.
Additionally, Thursday will bring the usual release of initial jobless claims figures, along with the US Producer Price Index (PPI). The five-day period will conclude on Friday the 13th with the release of the University of Michigan’s US Consumer Sentiment Index.

CRYPTOCURRENCIES: "Fainting Spell" and "Heat Death" for Bitcoin, "Sewer" for Altcoins

● September has only just begun, but it is already justifying its title as a bear month, one of the worst for investors. Historical data indicates that the average decline in bitcoin's price during this first autumn month was 6.18%. The optimism of chart analysis enthusiasts has thus far not helped the BTC/USD pair. The base of the bullish "flag" continues to sag downward sadly. The formation of the "cup and handle" is also not completing, after which bitcoin was expected to soar to $110,000 by the end of the year. There has been no surge so far, but bearish forecasts are becoming more and more…
● According to Ecoinometrics, bitcoin has lost its lead among high-capitalisation assets in terms of RAROC (Risk-Adjusted Return on Capital). The first cryptocurrency was surpassed by shares of graphics processor developer Nvidia, while gold is now closely trailing behind BTC. Nvidia's shares have risen by 142% since the start of 2024, while bitcoin has only gained 35% during the same period. Ethereum lags even further behind, with an increase of just 5%.
Peter Schiff, President of Euro Pacific Capital and a well-known bitcoin critic, noted that while the first cryptocurrency has risen in price since the beginning of the year, the real growth occurred only in the first two months, driven by the hype surrounding the launch of spot BTC-ETFs in the US. "If you didn’t buy bitcoin at the beginning of January, you have no profit. In fact, the vast majority of people who bought bitcoin this year, either directly or through ETFs, are losing money," stated the "gold bug" Schiff.
He emphasised that physical gold has steadily increased in value throughout 2024, and the hopes of crypto-enthusiasts that BTC would surpass this precious metal or match it in market capitalisation are becoming increasingly elusive. Schiff added that while he is open to new developments, he has yet to encounter any convincing argument that would change his strongly negative stance on bitcoin. The businessman is confident that sooner or later the price of digital gold will collapse to zero, bankrupting all holders of this cryptocurrency.
● The investor known by the pseudonym Nick Crypto Crusade painted an equally bleak picture of the digital asset market. In his publication titled "The Bull Rally is Cancelled, and Altcoin Season Will Never Begin," he noted that ordinary traders are in a state of pessimism, as they don't believe a bull season is coming anytime soon, and sell off their bitcoins whenever the price approaches $70,000. In his view, the current situation resembles the events of 2022, when the market was dominated by a bearish trend, and no one could see light at the end of the tunnel. Nick Crypto Crusade concluded that people are leaning towards the idea that bitcoin will drop to $40,000 or even lower, and that an altcoin season will never start.
A similar forecast was made by former BitMEX CEO Arthur Hayes. He outlined a scenario in which BTC could fall to $50,000, while altcoins could collapse entirely, landing in the "sewer." Hayes attributed this to changes in the Federal Reserve’s balance sheet under the Reverse Repo Program (RRP). A higher RRP balance effectively removes liquidity from the financial system, keeping money inactive on the balance sheet of the US central bank and preventing it from being reinvested or used for borrowing. According to Hayes, "As soon as RRP started to rise to $120 billion, bitcoin fainted."
● Experts from the Outlier Ventures platform have stated that halving has ceased to have an impact on bitcoin. In their view, 2016 was the last year when the reduction in miner rewards had a fundamental effect on the price of the first cryptocurrency. CryptoQuant also looked into the past and noted that the number of active wallets is currently as low as it was in 2021. "We are observing a decrease in overall network activity, with fewer transactions, which may reflect a decline in interest in using the bitcoin blockchain. This sense of disinterest is negatively affecting the price, coinciding with low trading volume figures," summarise the CryptoQuant experts.
● Charles Hoskinson, the founder of Cardano and co-founder of Ethereum, stated that the crypto industry no longer needs bitcoin. According to him, bitcoin has turned into a religious symbol, which dooms its ecosystem. "98% of the changes in the industry are happening outside of the first cryptocurrency," writes Hoskinson. "The hash rate of the digital gold blockchain will decrease, and it will slowly transition to heat death."
As an example, the Cardano founder referred to the situation with the Windows operating system, which stopped innovating, leading users to switch to Android and iOS devices. Hoskinson noted that he had repeatedly urged bitcoin developers to adopt innovations, but the community ignored his initiatives.
● Given the above, one might ask: Is everything really so bad, and are there no more hopes for growth? As the ancient Greek philosopher Diogenes of Sinope once said, hope dies last. Therefore, it's always worth hoping for the best. The aforementioned Arthur Hayes is quite optimistic about the long-term development of the crypto market, as he expects the US Federal Reserve to ease its monetary policy.
Of course, the recent price declines have scared off many small crypto holders and short-term speculators, who have started selling off their reserves. On the other hand, large investors have continued to accumulate. According to the analytics firm Santiment, this category includes wallet holders with between 10 and 10,000 BTC. Due to this redistribution, whales now control nearly 67% of the total circulating supply of coins. The fact that major investors are accumulating digital gold suggests their positive expectations for its future price growth.
● A similar conclusion, based on other metrics, is drawn by Willy Woo, one of the most popular figures in crypto analysis. He pointed out that long-term bitcoin holders currently control over 14 million BTC, or 71% of the circulating supply. In his view, such significant accumulation by HODLers is a positive sign of market stabilization. Willy Woo noted that bears are gradually starting to lose their dominance.
The Fed's interest rate decision on 18 September will, of course, be crucial. However, according to Woo, the first cryptocurrency is likely to remain in a sideways trend throughout September. Unless extraordinary events occur over the next few weeks, significant changes in bitcoin's price can be expected only at the beginning of October. According to Willy Woo, predictions from some experts that BTC could surpass the $65,000 mark in the short term are unlikely to come true. Reaching a new all-time high (ATH) may take a few more months, possibly happening by the end of the year.
● In their report, specialists from the crypto exchange Bitfinex also highlighted the impact of the US Fed's rate decision on bitcoin's price. The exchange's analysts believe that "a 25 basis point cut will likely signal the start of a loosening cycle, which could lead to a long-term increase in bitcoin’s price as liquidity grows and recession fears ease." However, if the rate is cut by 50 basis points, it could trigger an immediate price spike, followed by "a correction as recession fears intensify."
Bitfinex analysts do not rule out that, as a result of increased volatility during this period, the BTC/USD pair could temporarily lose 15-20% of its value.
● At the end of the week, bitcoin and the crypto market as a whole experienced another bearish attack. The crash followed the decline of the S&P 500 stock index, largely driven by bad news related to Nvidia. The US Department of Justice's Antitrust Division is conducting a major investigation into the company, which significantly alarmed investors with stakes in AI.
As of the time of writing, on the evening of Friday, 6 September, the BTC/USD pair is trading around $52,650. The total cryptocurrency market capitalization has fallen below the psychologically important level of $2.0 trillion, now standing at $1.87 trillion (compared to $2.07 trillion a week ago). Bitcoin's Crypto Fear & Greed Index has plummeted from 34 to 22 points, moving from the Fear zone into Extreme Fear territory.

CRYPTOCURRENCIES: "Playful" Solana and Ripple Forecasts

● Former Goldman Sachs executive and now CEO and Co-Founder of Real Vision, Raoul Pal, believes that gaming applications using cryptocurrencies are on the verge of a breakthrough. The transition from Web2 to Web3 will be a major catalyst for change in both the gaming industry and the blockchain space. As a result, we may witness an explosive surge in user interest in such applications in the coming months. According to Raoul Pal, this will trigger a wave of large-scale trading in crypto-assets used in these games. Solana is expected to play a leading role in this development, as a significant number of new tokens are being created on its network.
● Despite Ripple's victory over the SEC (U.S. Securities and Exchange Commission), XRP has been unable to solidify its position above the critical resistance level of $0.60 (currently priced at $0.5069). However, according to some analysts, the altcoin could still end the year with moderate price growth, potentially reaching $0.66 per coin. Experts at CoinCodex suggest a target of $1.10. But even this is not the limit—XRP maximalists do not rule out the possibility of the token reaching $1.50 by the end of the year. Their forecast is based on XRP's "unique position in the financial sector, considering its focus on cross-border payments and partnerships with major financial institutions."



NordFX Analytical Group

Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.

August 2024 Results: Three NordFX IB Partners Earned Over $77,000 in a Month


The brokerage company NordFX has summarized the trading performance of its clients for August 2024. Additionally, the social trading services, CopyTrading and PAMM, along with the profits earned by the company’s IB partners, were evaluated.

● In August, the top, "golden" spot on the podium was claimed by a client from South Asia, account No. 1782XXX, who earned 142,908 USD from trading gold (XAU/USD).
– The second place was secured by a trader from Western Asia, account No. 1785XXX, who also traded the XAU/USD pair, earning 32,471 USD.
– The TOP-3 is rounded out by a client from East Asia, account No. 1609XXX, with a profit of 24,196 USD. However, unlike the top two leaders, this impressive result was achieved through bitcoin (BTC/USD) trading.

● The situation in NordFX's passive investment services is as follows:
– A month ago, in our CopyTrading review, we mentioned the signal Bro, which, at that time, had increased the initial deposit by a staggering 554% in just 6 days (!). However, we cautioned that such exceptional results could only be achieved through highly aggressive trading, which also meant the risk of losing the entire investment was extremely high. This warning proved to be well-founded, as by 13th August, the deposit losses had reached 100%. Thus, Bro lasted only three weeks before ceasing to exist.
This is precisely why it is essential to consider not only profit but also drawdown. For this reason, we continue to monitor the signals NordFXSrilanka and Quiet_trade_USD. Of course, their profits may not seem as impressive at first glance, but they still far exceed the interest rates on USD bank deposits. Thus, NordFXSrilanka has shown a growth of 48% over 236 days with a maximum drawdown of less than 10%. Quiet_trade_USD has achieved a profit of approximately 15% since the end of February this year, with a moderate drawdown slightly exceeding the same 15%.
– On the PAMM service showcase, a startup Gold24 has already appeared. The name of this account speaks for itself – trading is conducted exclusively on NordFX's popular XAU/USD pair. The number "24" in the name could signify 24-carat purity (pure gold without any alloys), or perhaps it indicates that trading on the pair is conducted 24 hours a day. We consider both possibilities equally likely. Regardless, in just three months of operation, the manager of this account has achieved a profit of 73% with a maximum drawdown of 31%.
 
● The TOP-3 NordFX IB partners received the following commissions in August:
– The highest commission of 36,691 USD was awarded to a partner from South Asia, account No. 1576XXX.
– The second place goes to another partner from the same region, account No. 1678XXX, who earned 27,244 USD.
– Finally, the TOP-3 is completed by yet another partner from South Asia, whose account No. 1678XXX differs only in the last three digits. His commission amounted to 13,690 USD.
 
Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.

Forex and Cryptocurrency Forecast for September 02 – 06 2024

EUR/USD: Dollar Takes the Offensive

● Since the beginning of July, the DXY dollar index had been declining, reaching an eight-month low of 100.51 on 27 August. The primary reason for this negative trend was the concern about a potential slowdown in the U.S. economy. According to the markets, to support the economy, the Federal Reserve (Fed) was expected to begin easing its monetary policy (QE) and aggressively cutting interest rates. As early as July, several members of the Federal Open Market Committee (FOMC) were ready to vote for a rate cut. However, they refrained from doing so, deciding to wait until September to make a decision based on more up-to-date macroeconomic indicators. A 25 basis points (bps) rate cut at the FOMC meeting on 18 September is almost universally anticipated. Moreover, the likelihood of a 50 bps cut reached 35% last week. The futures market also estimated that the total reduction in the cost of dollar borrowing by the end of the year would amount to 95-100 bps. As a result, such actions by the U.S. central bank were expected to lead to a sharp increase in risk appetite and exert additional pressure on safe-haven assets, including the U.S. currency.
In light of forecasts for a U.S. economic slowdown, market participants began discussing a reduction in divergence with the Eurozone and the UK. Consequently, the euro and pound became the main beneficiaries, as clearly reflected in the EUR/USD and GBP/USD charts. However, as the ancient wisdom goes, all good things must come to an end. Life, like the stripes of a zebra, alternates between good and bad times. Thus, after a period of gains, the euro and pound have now entered a darker phase. (Although, to be honest, it’s not entirely dark, just somewhat grey).
● It turns out that things are not so bad in the U.S. After all. According to preliminary data released on Thursday, 29 August, the country's GDP grew by 3.0% in Q2, surpassing both the forecast of 2.8% and the previous figure of 1.4%. On the same day, labour market statistics showed that the number of initial jobless claims in the United States remained virtually unchanged, standing at 231K compared to the forecast of 232K and the previous figure of 233K. Additionally, the Core Personal Consumption Expenditures (Core PCE) Price Index, a key inflation indicator, remained steady in August at 2.6% year-over-year, in line with the July figure and slightly below the forecast of 2.7%.
● From all the figures mentioned above, it is clear that fears of an economic slowdown and a cooling U.S. labour market are greatly exaggerated. It is also premature to declare a final victory over inflation, just as it is too early to assume that the Fed will cut interest rates by 100 basis points by the end of the year. As Raphael Bostic, President of the Federal Reserve Bank of Atlanta, wisely pointed out, it would be undesirable to find ourselves in a situation where, after easing monetary policy, we need to tighten it again. As another saying goes, "haste makes waste."
The idea that there is no need to rush is further supported by the replacement of the elderly Joe Biden with Kamala Harris in the presidential race. For the first time since April of last year, the Wall Street Journal's polls show the Democratic candidate's rating, albeit slightly, surpassing that of Republican Donald Trump. Therefore, forecasts of a U.S. economic recession should also be postponed for the time being. In this context, Citigroup economists believe that September will be a period when the potential outcome of the presidential election could become a source of significant volatility. However, regardless of how candidate ratings fluctuate, this factor of uncertainty will continue to support the dollar as a safe-haven currency.
● All the above suggests that the markets may be significantly overestimating the speed and scale of QE from the Federal Reserve. On the other hand, they may be underestimating the European Central Bank's (ECB) resolve to take similar actions.
It is worth recalling that on 6 June, the pan-European regulator cut the interest rate by 25 basis points to 4.25%. Many assumed that after this move, the ECB would pause and observe the Fed's actions (where the rate stands at 5.5%). However, it is possible that such expectations are misguided. The weakness of the German economy and other Eurozone countries should push the ECB towards more active steps in the direction of QE. (Macroeconomic data released on Tuesday, 27 August, showed a decline in Germany's GDP by -0.1% quarter-on-quarter, compared to +0.2% in Q1). Inflation is also falling sharply: Germany's Consumer Price Index (CPI), according to preliminary data, decreased from +0.3% to -0.1% month-on-month. The same trend is evident across the Eurozone as a whole: according to data published on Friday, 30 August, the CPI here dropped year-on-year from 2.6% to 2.2%. This is very close to the target level of 2.0%. Therefore, it is quite possible that at its meeting on 12 September, the ECB, when choosing between fighting inflation and supporting the economy, may opt for the latter and cut the rate by another 25 basis points.
● It appears that market participants have taken our arguments into account. At least, after surging to 1.1201, the EUR/USD pair returned to its 19 August levels by the end of the week, finishing the five-day period at 1.1047. (The GBP/USD pair demonstrated similar dynamics, where this reversal could also mark the first step in a trend shift from north to south).
The median forecast for EUR/USD in the near term is as follows: 75% of analysts are in favour of further dollar strengthening and a decline in the pair, while 25% expect it to rise. In technical analysis on D1, 25% of oscillators are coloured red, 35% green, and the remaining 40% are neutral grey. Among trend indicators, 35% have sided with the reds, while 65% voted for the greens. The nearest support for the pair is located in the zones of 1.0985-1.1015, 1.0880-1.0910, 1.0780-1.0825, 1.0725, 1.0665-1.0680, and 1.0600-1.0620. Resistance zones are found in the areas of 1.1090-1.1105, 1.1170-1.1200, followed by 1.1230-1.1275, 1.1350, and 1.1480-1.1505.
● The upcoming week promises to be quite eventful, interesting, and volatile. Starting from Tuesday, 3 September, through Thursday, 5 September, data on business activity (PMI) across various sectors of the U.S. economy will be released. Additionally, on 4, 5, and 6 September, we can expect a wave of U.S. labour market statistics, including key indicators such as the unemployment rate and the number of new non-farm jobs created (NFP). As for the Eurozone, Thursday, 5 September, will be noteworthy for retail sales data in the region. And at the very end of the workweek, on 6 September, the Eurozone GDP volume will be announced. Moreover, traders should keep in mind that Monday, 2 September, is a holiday in the U.S. as the country observes Labour Day.


CRYPTOCURRENCIES: The Fed, a Cup Handle, and the Banana Season of Madness



● Inflation is one of the key indicators influencing the monetary policy and interest rate decisions of the U.S. Federal Reserve. These, in turn, are among the primary factors determining the attractiveness of cryptocurrencies for investors. A recent example of this was the dovish speech by the head of the U.S. Central Bank, Jerome Powell, at the Annual Economic Symposium in Jackson Hole, USA, on 23 August. Powell did not rule out a series of interest rate cuts for the remainder of the year. The market reacted to this with a plunge in the DXY Dollar Index to 100.60 and a nearly 7% surge in the BTC/USD pair, from $60,800 to $65,000.
However, the rally did not continue. The eight-day period of net inflows into spot BTC ETFs, during which they attracted over $756 million, ended on Tuesday, 27 August. On that single day, more than $127 million flowed out of cryptocurrency funds. As a result, the BTC/USD pair plummeted and found support only in the $58,000 zone. Naturally, the leading cryptocurrency dragged the altcoin market down with it.
● According to analysts at QCP Capital, the trigger for the market crash was the uncertainty among participants regarding the future of the leading cryptocurrency. As a result, traders were quick to lock in profits. In this situation, while the market sentiment remains bullish, QCP Capital believes that a rapid rise in BTC prices should not be expected for now. Signals of renewed interest in BTC from large institutional investors are necessary to resume active growth. Michael van de Poppe, the head and founder of MN Trading, also believes that bitcoin has not yet fully escaped the "range of lows" between $61,000 and $62,000. In his view, a decisive breakout from this range is essential to confirm a rally toward BTC's all-time high.
Analysts at Glassnode agree with their colleagues. They believe that in the short term, BTC is unlikely to surpass the $70,000 mark. However, according to their observations, "both on-chain indicators and perpetual contracts show that the period of equilibrium is coming to an end, with the beginning of increased volatility and trading volume," which could allow the asset to break out of its narrow price corridor.
● Samson Mow, a bitcoin maximalist and a well-known figure in the crypto industry, has raised concerns by drastically reducing his BTC price forecast by a factor of ten. Just recently, in July, Mow declared that the leading cryptocurrency would reach $1 million within a year. However, in a new comment, he stated that "as long as bitcoin's price remains below $0.1 million, the coins are being sold at a discount." This comment has led the crypto community to believe that he may have lost faith in a powerful bull rally. The $0.1 million mark refers to $100,000, which means that anything below this figure is considered a discounted price, and $100,000 is what Mow now sees as the fair value of bitcoin. (For reference, Samson Mow is a crypto investor, entrepreneur, blogger, and television host. He was the CEO of the blockchain company Pixelmatic and the Chief Strategy Officer at Blockstream. He is currently the CEO of JAN3 and Pixelmatic.)
Another influencer, Anthony Scaramucci, CEO of SkyBridge Capital, shares a similar view on the "fair" value of bitcoin. He continues to uphold his forecast that digital gold will rise to $100,000, driven by spot BTC-ETFs. However, he has now cautioned that reaching this target may be delayed from the end of 2024 to 2025 due to regulatory uncertainty and the increasing prevalence of crypto fraud. "I could be wrong about the timing, but not the actual outcome. I genuinely believe that bitcoin will reach $100,000; it just might take longer," he wrote.
● Renowned macroeconomist Henrik Zeberg is convinced that a recession in the United States is inevitable, potentially arriving as early as Q4 of this year. Moreover, he believes it will be the worst since the Great Depression of 1929. According to Zeberg, the upcoming bear market will unfold in two stages: a deflationary phase followed by stagflation, with an intermediate rebound as the Fed intervenes in 2025. After this, there will be a "blow-off top," where prices skyrocket to unsustainable levels before plummeting rapidly.
Alongside this forecast, Zeberg has revised his target figures for stock indices and bitcoin upwards. According to his BlowOffTop business cycle model, the price of the leading cryptocurrency should rise to $115,000-$120,000 by the end of 2024. However, the economist cautions that this surge will be short-lived.
Arthur Hayes, former CEO of the crypto exchange BitMEX, also weighed in, suggesting that a reduction in Federal Reserve interest rates might temporarily diminish the appeal of traditional financial instruments, causing speculative investors to focus more closely on cryptocurrencies. However, Hayes warns that this rate reduction "will have only a short-term effect, much like sugar provides a quick burst of energy." He believes that assets like bitcoin are likely to benefit from the increased liquidity in financial markets, but overall, the Fed's decision could further exacerbate inflationary pressures.
● Shifting from fundamental to technical analysis, the forecast by the analyst known as MetaShackle is noteworthy. He suggests that bitcoin's continued consolidation within an increasingly narrow price range makes its breakout inevitable. On a larger scale, this range acts as the "handle" of a 3-year "cup." "BTC is forming a massive 'Cup and Handle' on the daily/weekly chart. Such a formation has never been seen before in the history of cryptocurrencies, and it will surely lead to an incredible run to levels that will shock the world," writes MetaShackle.
The "Cup and Handle" pattern is a bullish chart formation in trading. It typically consists of a rounded bottom (the cup), followed by a slight downward drift (the handle), indicating a potential upward breakout. The "largest cup and handle in cryptocurrency history," as described by MetaShackle, begins with bitcoin's peak in November 2021 at $69,000. This was followed by a bear market that consolidated over the next two years, forming a cup with a bottom at $15,500. The opposite rim of the "cup" is marked by a new all-time high in March 2024 at $73,800. After this, the "cup" formation was completed, and the "handle" phase began. This next phase has been ongoing for six months, consolidating with a slight downward trend.
Traders use this model to determine price targets by measuring the depth of the "cup" and projecting that distance upwards from the breakout point of the "handle." According to MetaShackle's calculations, BTC could rise from the bottom by 761% and soar to $130,870.
Another well-known analyst, Gert van Lagen, also believes that the chart shows bitcoin transitioning from a downtrend to an uptrend. Bitcoin is currently moving around the "handle," he notes, "on the verge of entering the banana zone," signifying a period when BTC and altcoins experience explosive price growth. Previously, Real Vision's Jamie Coutts stated that the leading cryptocurrency is about to "enter a season of madness." According to Coutts, by the end of the year, bitcoin's price could exceed $150,000.
Two weeks ago, we mentioned another analyst, Rekt Capital, who predicted a surge in the first cryptocurrency's value in October. His forecast was based on a different pattern forming on the BTC/USD chart: a "bull flag," where the breakout height equals the height of the flagpole.
● At the time of writing this review, on the evening of Friday, 30 August, the BTC/USD pair is trading around the $59,100 zone. The total market capitalization of the crypto market stands at $2.07 trillion, down from $2.24 trillion a week ago. The Crypto Fear & Greed Index has risen from 27 to 34 points, but it remains in the Fear zone.
● And finally, some encouraging statistics. According to consulting firm Henley and Partners, the number of bitcoin millionaires (those holding more than $1 million in BTC) has increased by 111% since January 2024, reaching 85,400 individuals. If we consider not only the holders of the flagship asset but crypto millionaires in general, the number is even higher: 172,300 people. This represents a 95% increase compared to a year ago when the figure was 88,200. The number of individuals with digital assets worth $100 million or more has grown by 79% to 325 people. Six new members have joined the ranks of crypto billionaires, bringing the total to 28.

NordFX Analytical Group

Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.

CryptoNews

– Undoubtedly, the recent arrest of Pavel Durov, the programmer, creator, and owner of the Telegram messenger, has become the event of the past few days. The billionaire was detained on 24 August at Le Bourget Airport in Paris, where he had arrived by private jet from Azerbaijan. At the time, Russian President Vladimir Putin was on an official visit to the Azerbaijani capital, Baku. According to one version, Durov sought to meet with him but was refused.
According to media reports, the detention at Le Bourget is linked to an investigation being conducted in France regarding the Telegram messenger created by Durov. Investigators believe that the lack of moderation and insufficient cooperation by the messenger's administration with the country's authorities have complicated the fight against drug trafficking, money laundering, fraud, paedophilia, and other offences, leading to the commission of a "wide range of crimes" on the platform. In addition to his Russian citizenship, Pavel Durov holds citizenships of Saint Kitts and Nevis, the UAE, and France. As a French citizen, he is obliged to cooperate with the country's authorities.
The incident has sparked a strong reaction worldwide. Some influencers have accused the French authorities of attempting to restrict citizens' rights and freedom of speech, while others have supported their actions. Commentators also note that Durov's arrest could pose a significant problem for Russia, as his Telegram application is one of the primary communication channels for Russian troops in Ukraine. Moreover, the messenger is also actively used by the Russian authorities, including members of the Government and Parliament, and their correspondence may contain highly important and top-secret information.
For reference: Pavel Durov was born in 1984 in Saint Petersburg. Immediately after graduating from university, he created the social network VKontakte, which is currently the largest in Russia. In 2014, it became known that due to pressure from the Russian security services, he was forced to sell VKontakte and leave the country. As the entrepreneur stated, "I'm afraid there is no way back for me, especially after I publicly refused to cooperate with the [Russian] authorities." And now he is facing new problems: this time due to his refusal to cooperate with the French authorities.

– Samson Mow, a bitcoin maximalist and one of the most prominent figures in the crypto industry, has surprised many by drastically lowering his BTC price forecast by tenfold. Just recently, in July, Mow announced that the leading cryptocurrency would reach $1 million within a year. However, in a new comment, he stated that "as long as the bitcoin price remains below $0.1 million, coins are being sold at a discount." This has led the crypto community to believe that he may have lost faith in a strong bull rally. The $0.1 million figure refers to $100,000. In other words, anything below this figure is considered a discounted price, while $100,000 is deemed the fair value according to Mow.
For reference: Samson Mow is a crypto investor, entrepreneur, blogger, and TV host. He was the CEO of the blockchain company Pixelmatic and the Chief Strategy Officer at Blockstream. Currently, he serves as the CEO of JAN3 and CEO of Pixelmatic.

– Inflation is one of the key indicators influencing the monetary policy and the Federal Reserve's interest rate decisions in the United States. These, in turn, are among the primary factors determining the attractiveness of cryptocurrencies to investors. A further confirmation of this was provided by the dovish speech given by Jerome Powell, the Chairman of the U.S. Federal Reserve, at the Annual Economic Symposium in Jackson Hole (USA) on the evening of Friday, 23 August. Powell did not rule out the possibility of a gradual reduction in the interest rate for the remainder of the year. The market reacted to this with a drop in the DXY Dollar Index to 100.60 and a surge in the BTC/USD pair by nearly 7%: from $60,800 to $65,000.

– After the surge to $65,000, the rally did not continue. According to analysts at QCP Capital, the hesitation among market participants regarding the future of the leading cryptocurrency acted as a brake, leading traders to quickly lock in profits. In this situation, QCP Capital believes that although the market is showing bullish sentiment, a rapid increase in BTC prices should not be expected for now. For the resumption of significant growth, signals indicating renewed interest in BTC from major institutional investors are necessary.

– Anthony Scaramucci has recently stated in an interview with CNBC that the bullish reversal for bitcoin accelerated this year after the U.S. Securities and Exchange Commission (SEC) approved spot BTC ETFs. According to the expert, this is the most successful launch of exchange-traded funds in history. The SEC's approval of such funds has increased the legitimacy of the crypto asset. The entrepreneur added that BTC ETFs remain a catalyst for the growth of the leading cryptocurrency, as the number of traditional investors in the crypto market has significantly increased. Bitcoin, he said, will continue to be an effective store of value despite the 30% increase in the price of gold over the past two years.
Previously, the head of SkyBridge Capital predicted that digital gold would reach $100,000 by the end of 2024. However, he now warns that achieving this target might be delayed due to regulatory uncertainty and the increasing frequency of crypto fraud. "I might be wrong about the timing, not the actual outcome. I truly believe bitcoin will reach $100,000; it will just take more time," he wrote.
For reference: Anthony Scaramucci is a financier and the founder of SkyBridge Capital. He is also known for his record-short tenure as the White House Communications Director, a position from which he was dismissed by then-President Trump after just 10 days.

– Renowned macroeconomist Henrik Zeberg is convinced that a recession in the United States is inevitable and could occur as early as the fourth quarter of this year. Moreover, he believes it will be the worst recession since the Great Depression of 1929. According to Zeberg, the upcoming bear market will unfold in two stages: a deflationary phase followed by stagflation, with an intermediate rebound as the Federal Reserve intervenes in 2025. This will be followed by what he calls the "blow-off top," where prices soar to unsustainable levels and then plummet rapidly.
Alongside this forecast, Zeberg has revised his target figures for stock indices and bitcoin upwards. According to his BlowOffTop business cycle model, the price of the leading cryptocurrency is expected to rise to $115,000-120,000 by the end of 2024. However, the economist warns that this will be a short-lived surge.

– Robert F. Kennedy Jr. has withdrawn from the U.S. presidential race, announcing his support for Donald Trump. The former presidential candidate admitted that if Trump were to win, he would be willing to lead the CIA. American media outlets are speculating that Kennedy Jr. might join Trump's campaign and possibly even his team. Following this, users on the decentralized prediction platform Polymarket have wagered $87 million, indicating a 51% likelihood that the Republican candidate will become the next President of the United States. The chances for the Democratic candidate, Kamala Harris, have dropped to 48%.
Like Trump, Kennedy Jr. positions himself as a crypto-friendly politician. As for Kamala Harris, she continues to refrain from expressing her views on cryptocurrencies, which could negatively impact her campaign in the future. According to analysts at Coinbase, digital asset holders and cryptocurrency supporters could significantly influence the election outcome.

– On 25 August, Michael van de Poppe, the head and founder of MN Trading, noted that bitcoin has not yet definitively broken out of the "lower range" between $61,000 and $62,000. According to him, this is a crucial level for confirming a rally towards BTC's all-time high. The trader also pointed out that the prevailing bearish sentiment has caused Ethereum to sharply decline against bitcoin, with the ETH/BTC pair reaching new lows. However, van de Poppe believes that sentiment will soon shift, leading to the beginning of an altcoin season.
Earlier, specialists at CryptoQuant also stated that the correction in Ethereum's price is nearing its end. According to their forecasts, the asset is expected to soon experience a price surge.

– At present, the market capitalization of the leading cryptocurrency, bitcoin, is approximately $1.27 trillion, which is about 3.8 times higher than that of the main altcoin, Ethereum, at around $330 billion. Nick Tomaino, CEO of the crypto investment firm 1confirmation, believes that "both assets will continue to grow, but ETH will surpass BTC within the next five years. The reason is simple. Bitcoin has a straightforward narrative (digital gold), which has already attracted institutional investors. Ethereum, on the other hand, has been the most influential blockchain in the industry over the last five years, but it remains not fully understood." This latter factor, according to Tomaino, will be the driving force behind the altcoin's rise.
"Since Ethereum's market capitalization is currently significantly lower than bitcoin's, Wall Street can acquire a larger amount of ETH. They will do so and aggressively promote the asset in the coming years," Tomaino writes. The analyst also believes that the value of Ethereum will be bolstered by the technological advancements of its network and its popularity as the leading smart contract platform.

– According to a survey by Date Psychology, the majority of women (77%) find cryptocurrency enthusiasts to be unattractive. The only group viewed less favourably are those who collect Funko figures (toys dedicated to characters from films, comics, cartoons, etc.). This may be due to the perception that women consider digital assets to be unserious and, as a result, project this view onto men who are involved with them.
The most attractive hobbies among male respondents were reading, learning foreign languages, and playing musical instruments. However, other surveys indicate that women working in the crypto industry often achieve greater success and frequently hold higher positions than their male colleagues.

Forex and Cryptocurrency Forecast for August 26 – 30, 2024


EUR/USD: Fed Chair Sinks the Dollar

● On Wednesday, 21 August, the DXY dollar index dropped to an eight-month low, finding support at the 100.92 level. Consequently, the EUR/USD pair recorded a 13-month high, reaching 1.1173. The last time it reached such heights was in July 2023. This dynamic can be attributed to the rise in global investor risk appetite, the narrowing divergence in economic growth between the US and the Eurozone, and, of course, expectations of decisive steps by the Federal Reserve towards monetary policy easing (QE).
A 25 basis point rate cut at the FOMC (Federal Open Market Committee) meeting on 18 September is almost universally expected. Moreover, following the release of updated data on the US labour market, the probability of a 50 basis point cut increased from 30% to 35%. The futures market also anticipates that the total reduction in the cost of dollar borrowing by the end of the year will amount to 95-100 basis points.
As for the euro, expectations are significantly more modest: there is a 40% probability of a 25 basis point rate cut at the ECB meeting on 12 September. Overall, a 50 basis point cut is projected by the end of the year. This divergence in the pace of QE provides a certain advantage to the euro. As a result, according to data from Swiss UBS Group, algorithmic traders alone sold approximately $70-80 billion in August. On the other hand, as noted by analysts at Bank of New York Mellon, financial managers have been actively buying the euro in the last few days of the week.
● In July 2022, inflation in the US stood at 9.1%. Thanks to the tightening of monetary policy (QT), the US central bank managed to bring it down to 3.0%. However, the Consumer Price Index (CPI) then practically plateaued, stubbornly refusing to approach the target of 2.0%. In fact, it occasionally rose to 3.5-3.7%. In August, the CPI was recorded at 2.9%.
On the other hand, raising the interest rate to a 23-year high of 5.50% and maintaining it at this level for the past nine months has led to problems in the US economy. The manufacturing activity index dropped to eight-month lows, while unemployment in the country increased from 3.7% to 4.3%. As a result, the regulator is now faced with a choice: either continue the fight against inflation or support the economy. It is evident that the Fed will choose the latter. Notably, back in July, several FOMC members were ready to vote for a rate cut. However, they refrained, opting instead to wait until September to make a decision based on more up-to-date macroeconomic indicators.
● Unlike the Federal Reserve, the European Central Bank (ECB) may implement its monetary policy easing at a more moderate pace, judging by several factors. Consumer inflation (CPI) is currently at 2.6%, the growth of the average agreed wage in the Eurozone slowed in Q2 from 4.7% to 3.6%, and the interest rate stands at 4.25%, which is 125 basis points lower than the current Fed rate.
According to data released on Thursday, business activity in the Eurozone increased. The composite PMI index, according to preliminary estimates, rose to 51.2 points in August, up from 50.2 the previous month. Markets, on the contrary, had forecasted a decline in the index to 50.1 points. PMI values above 50.0 indicate economic growth, and this trend has slightly dampened expectations of two ECB rate cuts this year. However, some analysts believe this rise in business activity is temporary and driven by the Olympic Games in Paris. This theory is further supported by the fact that Germany's PMI, the engine of the European economy, is declining. The German composite index, which was expected to rise to 49.2, actually fell from 49.1 to 48.5 in August.
● Aside from macroeconomic statistics, the performance of the dollar this week may have been influenced by Federal Reserve Chair Jerome Powell's speech at the Annual Economic Symposium in Jackson Hole, USA, scheduled for the very end of the workweek, on Friday, 23 August. And it did have an impact, though not in the dollar's favour.
The Fed Chair confirmed that the time had come to adjust monetary policy. "Inflation has significantly decreased and is now much closer to the target. My confidence that inflation is on a sustainable path back to 2% has increased," Powell stated, noting that "upside risks to inflation have diminished, while downside risks to employment have increased." According to him, the cooling of the labour market is undeniable, and the Fed will do everything possible to support it. "The current rate level provides ample room to respond to risks, including an undesirable further weakening of the labour market. The timing and pace of rate cuts will depend on incoming data, outlook, and the balance of risks."
Thus, Powell left the door open for a gradual rate cut for the remainder of the year. The market responded to this by dropping the DXY dollar index to 100.60, and the EUR/USD pair surged to 1.1200. The pair ended the five-day period at the 1.1192 level. Before the Fed Chair's speech, 80% of surveyed analysts expected a further downward correction. However, after the speech, the balance of power shifted, and now only 40% expect the dollar to strengthen and the pair to fall to 1.1000 in the near future. An equal number sided with the euro, while the remaining 20% took a neutral stance. In technical analysis, all 100% of trend indicators and oscillators on D1 point north, although 15% of the latter are in the overbought zone. The nearest support for the pair is located in the 1.1170 zone, followed by 1.1095-1.1110, 1.1030-1.1045, 1.0985, 1.0880-1.0910, 1.0825, 1.0775-1.0805, 1.0725, 1.0665-1.0680, and 1.0600-1.0620. Resistance zones are found around 1.1200, then 1.1230-1.1275, 1.1350, and 1.1480-1.1505.
● The economic calendar for the upcoming week is packed with significant events. On Tuesday, 27 August, the GDP figures for Germany for Q2 will be released, and on Thursday, 29 August, the GDP data for the US will follow. Also, on 29 August, preliminary data on consumer inflation (CPI) in Germany will be available. Additionally, the traditional statistics on the number of initial jobless claims in the United States will be published on this day. Friday, 30 August, promises increased volatility due to the release of key inflation indicators such as the Consumer Price Index (CPI) in the Eurozone and the Core Personal Consumption Expenditures (Core PCE) index in the US. Moreover, 30 August is the last business day of the month, and many market participants will be taking steps to improve their balance sheet figures.


GBP/USD: Tortoises Beat Doves


● The slower a central bank reduces interest rates, the better its national currency tends to perform. This race between doves and tortoises has naturally extended to the GBP/USD pair. Investor confidence that the doves at the Federal Reserve will begin easing monetary policy at the upcoming September meeting continues to weigh on the dollar. On the other hand, the likelihood of a rate cut by the Bank of England (BoE) in September is far less certain. It is quite possible that QE in the United Kingdom will proceed at a tortoise-like pace, which has been pushing the GBP/USD pair upwards for the second consecutive week.
According to the latest data from the UK's Office for National Statistics, inflation (CPI) in the country remains relatively low at 2.2% year-on-year. This follows two months during which it was at the target level of 2.0%. The pound's rise accelerated amid strong unemployment figures, which exceeded expectations. On 13 August, it was reported that the unemployment rate fell in June to 4.2%, a significant improvement from May's 4.4%. Considering that the forecast pointed to a rate of 4.5%, this data made a strong impression on the market. Such a decline in unemployment indicates positive changes in the labour market and could be a sign of economic stabilization, which may boost investments.
Favourable reports on the Purchasing Managers' Index (PMI) further strengthened the pound. Data released by the Chartered Institute of Procurement & Supply and S&P Global on Thursday, 22 August, showed that the preliminary PMI in the UK exceeded expectations, jumping to 53.4 in August from 52.8 in the previous month. The manufacturing PMI also rose from 52.1 to 52.5 points, beating the forecast of 52.1. The services PMI increased to 53.3 in August from 52.5 in July, surpassing the consensus forecast of 52.8. Following the release of this positive data, the probability of a Bank of England rate cut in September dropped below 30%.
● Following the dovish speech by Fed Chair Jerome Powell, Friday evening in Jackson Hole also featured a speech by BoE Governor Andrew Bailey, during which the GBP/USD pair reached a high of 1.3230, closing at 1.3216.
The median forecast for the near term is entirely neutral: one-third of experts expect the dollar to strengthen and the pair to decline, another third favour the pound, while the remaining third are undecided. As for technical analysis on the D1 timeframe, similar to the EUR/USD, all 100% of trend indicators and oscillators point north (with 20% of the latter signalling overbought conditions). If the pair declines, it will encounter support levels and zones around 1.3070-1.3125, 1.2980-1.3010, 1.2940, 1.2815-1.2850, 1.2750, 1.2665-1.2675, 1.2610-1.2620, 1.2500-1.2550, 1.2445-1.2465, 1.2405, and 1.2300-1.2330. In case of an upward movement, resistance will be met at levels 1.3230-1.3245, 1.3305, 1.3425, 1.3485-1.3515, 1.3645, 1.3720, 1.3835, 1.4015, and the 30 May 2021 high of 1.4250.
● No significant events or macroeconomic statistics related to the state of the UK economy are scheduled for the upcoming week. Additionally, traders should be aware that Monday, 26 August, is a bank holiday in the UK.

CRYPTOCURRENCIES: Snake Trend in BTC Nears the Finish Line



● In our previous review, we didn't limit ourselves to the conventional concepts of bearish and bullish trends and introduced our own term for sideways movement within a narrow range: the Snake trend. True to its name, the BTC/USD pair continued to slither in a snake-like manner last week, making attempts to break below the $58,000 support or above the $62,000 resistance. This pattern persisted until the evening of 23 August.
● If we look at the medium-term chart, it becomes clear that after 14 March, when bitcoin reached a new all-time high (ATH) of $73,743, it has been moving within a descending channel, displaying significant volatility. Analysts at CryptoQuant believe that the decline in BTC's price is due to a reduction in purchases by issuers of spot exchange-traded funds (ETFs) in the US. In March, investment firms were buying an average of 12,500 BTC per day on exchanges, whereas from 11 to 17 August, this average dropped to just 1,300 coins: nearly ten times less. The monthly growth rate of crypto assets held by whales has decreased from 6% in March to the current 1%, which has inevitably impacted the price of the leading cryptocurrency. However, in our view, the key takeaway is that despite the slowdown, these holdings are still gradually increasing.
It is also important to note that the number of hodlers continues to grow. According to CryptoQuant, long-term retail holders have continued to accumulate digital gold, with a record-high monthly figure of 391,000 BTC.
Bitwise reports that the share of large institutional investors in the total assets under management (AUM) has risen from 18.74% to 21.15%. The fact that institutional investors maintain their confidence in the leading cryptocurrency is an encouraging sign. Experts highlight that the rate at which spot BTC-ETFs have been filled is the fastest in the history of all exchange-traded funds. Notably, 60% of the top 25 investment firms own bitcoin-based spot ETFs. Additionally, 6 out of the 10 largest hedge funds, including Citadel, Millennium Management, and G.S. Asset Management, are increasingly incorporating bitcoin ETFs into their investment strategies.
● Reports from institutional fund managers and companies for Q2 2024 clearly demonstrate a preference among major players for spot BTC-ETFs over products based on other assets, such as gold. "Large investors have stopped fleeing from the increased volatility of bitcoin, remaining relatively stable and inclined towards hodling," writes Andre Dragosch, Head of Research at ETC Group. According to this expert, the vast majority of investors who purchased shares in spot BTC-ETFs since the beginning of 2024 have increased their positions in the assets. "Of the companies registered in Q1, 44% increased their holdings, 22% maintained them, 21% reduced them, and 13% withdrew their stake in bitcoin-ETFs during Q2," writes Andre Dragosch. He concludes, "When compared to other exchange-traded funds, this performance is indeed impressive."
"When the bullish cycle begins, the number of investors eager to invest in exchange-traded products based on the leading cryptocurrency will increase significantly," predicts Bitwise. "We anticipate that in 2025, the inflow of funds into spot bitcoin-ETFs will exceed that of 2024, and in 2026, it will surpass that of 2025."
● We would like to add a couple of figures to this positive forecast. The first is that, according to data from the cryptocurrency exchange Binance, 50% of investors in Latin America are purchasing cryptocurrency for the long term. The second is that the total market capitalization of stablecoins is on the rise, reaching a new all-time high of $165 billion. Both of these figures indicate not only growing confidence in the future of digital assets but also increasing liquidity, which could serve as a pivotal foundation for the next bull rally. The only remaining question is: when will this rally finally begin?
● A number of experts believe that without the resumption of ETF purchases, overall demand for bitcoin may remain subdued. Considering the current consolidation (Snake trend) and the fact that the leading cryptocurrency closed July in the red, it’s possible that August could also end with losses. Based on this, Artificial Intelligence from PricePredictions has calculated that by 31 August, bitcoin will be trading at around $53,766, and in the last decade of September, it could approach the $48,000 mark.
● The analyst known as Crypto Banter strongly disagrees with the AI's forecast. He points out that the Stochastic RSI momentum indicator is entering the investment zone, signalling a potential opportunity for adding BTC to investor portfolios. Additionally, Crypto Banter highlights the Bitcoin Fear and Greed Index levels as important indicators for identifying potential market bottoms and profitable entry points. According to his observations, the current conditions suggest that now is an optimal time to open long positions on BTC.
● CryptoQuant shares a similar stance. On the Hash Ribbons indicator chart, the 30-day moving average (DMA) has crossed above the 60-day moving average. According to the company's analysts, this crossover often coincides with a low point in BTC's price, offering investors an opportunity to enter the market under more favourable conditions. "The Hash Ribbons indicator suggests that miner capitulation is nearing its end," they write. "The decrease in profitability due to increased computational power and reduced block rewards is pushing companies to invest in more energy-efficient equipment and data processing centres."
CryptoQuant experts believe that miners will continue with their strategy of accumulating bitcoin reserves, anticipating a rise in the cryptocurrency’s value to $70,000 or higher by the end of the year. As for smaller miners, CryptoQuant expects that they will gradually exit the market due to a lack of resources to purchase expensive equipment, leading to the formation of conglomerates dominated by major players in the mining industry.
● Michael Van De Poppe, CEO of MN Trading, is convinced that bitcoin will reach a new peak as early as this autumn, with institutional investors serving as the primary catalyst for its growth. These investors have been actively buying bitcoin during its price dip, and Van De Poppe believes that the recent correction could trigger a powerful rally in September or October this year. The key factor, according to him, is that bitcoin must continue to hold above the $57,000 mark.
Similarly, the analyst known as Rekt Capital has predicted that the bull rally will start around the same time. He suggests that approximately 160 days after the halving, bitcoin will enter a parabolic phase. Based on his calculations, this should occur in late September 2024.
● Matthew Sigel, Head of Digital Assets Research at VanEck, is also optimistic about bitcoin's future. He believes that bitcoin will approach its all-time high shortly after the US presidential elections. "We are observing a typical seasonal pattern where the first cryptocurrency usually faces challenges […] after the halving," he writes. "With the influx of liquidity, bitcoin should soon begin to rise." According to Matthew Sigel, regardless of who becomes the next US president, the market should prepare for four years of "reckless fiscal policy." It is during such a period that the first cryptocurrency will reach its peak values. He predicts that by 2025, influenced by a loosening of monetary policy, BTC will surpass its historical maximum.
● Zach Pandl, Managing Director at Grayscale Investments, agrees with this outlook in principle. He believes that the rise in bitcoin's price is driven not by statements from US presidential candidates but by macroeconomic trends and the weakening of the dollar. Pandl argues that the new administration is unlikely to take any significant steps toward regulating the crypto industry, and everything will likely remain as it is, as authorities are more concerned with the growing national debt. The Grayscale Investments executive noted that bitcoin is increasingly being seen by investors as an attractive tool for protecting against inflation and the devaluation of fiat currency. Pandl predicts that the US dollar will depreciate even further over the next decade, leading to increased investments in the leading crypto asset.
● Recently, the digital asset management company VanEck released a new forecast for bitcoin, outlining three potential price levels for BTC depending on market developments and its adoption as a global reserve asset. According to the base scenario, by 2050, the flagship cryptocurrency could reach $3 million per coin. Under the bearish scenario, the minimum value of BTC would be $130,314. However, if the bullish scenario comes to pass, 1 bitcoin could be worth $52.4 million in 26 years.
Against this backdrop, the forecast by Robert Kiyosaki, author of the bestseller "Rich Dad Poor Dad," seems relatively modest. The writer and economist believes that amid an impending downturn in currency and stock markets, the prices of precious metals will multiply, and the price of digital gold could reach $10 million per BTC.
● As of the time of writing this review, on the evening of Friday, 23 August, the BTC/USD pair is still far from reaching $10 million or $50 million. However, following the dovish speech by Fed Chair Jerome Powell in Jackson Hole, the pair capitalized on the weakening dollar, surged upwards, and reached a height of $63,893. The total market capitalization of the crypto market now stands at $2.24 trillion (up from $2.08 trillion a week ago). The Crypto Fear & Greed Index has risen from 27 to 34 points but remains in the Fear zone.

CRYPTOCURRENCIES: Bulls Poised to Lift ETH and Ripple

● According to data from the cryptocurrency exchange Crypto.com, the number of cryptocurrency holders grew by 6.4% in the first half of 2024, rising from 580 million to the current 617 million. Notably, Ethereum outpaced bitcoin in this regard. The number of ETH holders increased by 9.7%, from 124 million to 136 million, while bitcoin holders grew by 5.9%, reaching 314 million compared to 296 million at the end of December 2023.
Analysts at Crypto.com attribute the broader adoption of Ethereum to the Dencun upgrade in March. This hard fork resulted in some layer-2 protocols on the ETH blockchain reducing transaction fees by 99%. For bitcoin, key factors included the April halving, the launch of the Runes protocol, and the approval of spot BTC-ETFs, which attracted over $14 billion from institutional investors.
● Recently, well-known analyst and trader Peter Brandt, head of Factor LLC, predicted that Ethereum could "signal" a drop to $2,000 per coin or even lower. However, analysts at CryptoQuant disagree with this forecast from the Wall Street legend. In their view, ETH buyers are starting to regain their strength. "In June, when Ethereum's price reached $3,800, the Open Interest (OI) hit a record high, exceeding $13 billion. This indicated a potential market correction, which indeed occurred. On 5 August, the OI dropped to $7 billion, but it is now recovering," the company's analysts reported.
They believe that a significant increase in the price of the leading altcoin will become possible once leveraged players return to the market. "Current data shows that buyers are becoming more active. There is a trend suggesting that a strong bullish rally is on the horizon," CryptoQuant indicated. According to expert forecasts, positive momentum in the cryptocurrency market is already emerging, and it is expected to become more pronounced by the end of Q3.
● The Ripple (XRP) token is also showing a bullish signal. Technical indicators point to an inverted "Head and Shoulders" pattern on the daily chart of the altcoin, with the second shoulder still in the process of forming. Since the court ruling in the SEC (U.S. Securities and Exchange Commission) case against Ripple, XRP has been correlating with major cryptocurrencies like bitcoin, Ethereum, and Solana. Bouncing off the $0.55 support level, it has traded in a narrow sideways trend along with these mentioned assets following a 50% drop after the court decision.
As analysts have observed, Ripple has recently begun forming the second shoulder in this bullish pattern, with a potential risk-to-reward ratio of 1:2. This formation suggests that XRP could be poised for a significant upward move if the pattern completes as expected.




NordFX Analytical Group
 

Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.

CryptoNews

– Following the stock market crash on "Black Monday," August 5th, the World Gold Council (WGC) decided to examine the behaviour of various asset classes and explain why bitcoin should not be considered "the new gold."
First, the WGC highlighted volatility. For instance, the weekly volatility of physical gold in 2024 was 13.83%, while for bitcoin, it was 53.62%. "Gold and bitcoin are at opposite ends of the volatility spectrum," WGC analysts write, emphasising that gold has always played the role of a safe-haven asset on a global level. As for bitcoin, it is more of an indicator of how widely blockchain technology is used, so its behaviour resembles that of tech company stocks.
As an example, WGC experts suggest considering the correlation with the S&P 500 index in 2022. Based on this, they conclude that the onset of the Russia-Ukraine conflict "underscored gold's role as a safe-haven asset protecting investors from risks," which differentiates it from the leading cryptocurrency.
Furthermore, the WGC modelled the impact of adding these assets to an investment portfolio in a range of 2.5% to 10%. The Council concluded that gold reduces volatility and improves returns, even when its share in the portfolio is increased. However, the situation with bitcoin is different: the higher its share, the greater the risk of losses.

– According to data from the cryptocurrency exchange Crypto.com, the number of cryptocurrency holders grew by 6.4% in the first half of 2024, from 580 million people to the current 617 million. Meanwhile, the number of Ethereum holders increased by 9.7%, from 124 million to 136 million. Among holders of the first cryptocurrency, the growth was 5.9%: 314 million compared to 296 million at the end of December 2023.
According to Crypto.com analysts, the broader adoption of ETH followed the Dencun update in March. The hard fork resulted in some second-layer ETH blockchain protocols reducing transaction fees by 99%.
Key factors for bitcoin included the April halving, the launch of the Runes protocol, and the approval of spot BTC ETFs, which attracted over $14 billion in institutional investment.

 – Considering the current consolidation, crypto market participants are focusing on how bitcoin will trade in the short to medium term. Given that the leading cryptocurrency ended July in the red, it cannot be ruled out that August will also close with losses. According to PricePredictions' Artificial Intelligence, on August 31st, the coin will trade at $53,766, and in the last decade of September, it will approach $48,000.

–  The analyst known as Crypto Banter disagrees with AI. He pointed out that the Stochastic RSI momentum indicator is entering the investment zone, signalling the possibility of adding BTC to investors' portfolios. Crypto Banter also highlights bitcoin's Fear and Greed Index levels as important indicators for identifying potential market bottoms and profitable entry points. In his observations, current conditions suggest that now is an optimal time to open long positions on BTC, which is fluctuating within key support and resistance levels of $56,000 and $62,000, respectively.

– In China, cryptocurrency trading and mining are banned by law. However, according to the CEO of the analytics platform CryptoQuant, Ki Young Ju, miners from China account for 54% of global cryptocurrency mining. Additionally, according to a TechFlow survey, for 25% of respondents, crypto trading is the most important source of income and the main occupation in life.
49.14% of Chinese people consider themselves experienced experts in the digital market, while the remaining 50.86% regard themselves as beginners. More than half of the respondents admitted to experiencing a significant level of anxiety when dealing with cryptocurrencies. At least 60% admitted to being superstitious, and 40% reported praying to the "god of prosperity" before engaging in market transactions.
70% of respondents prefer to trade on the cryptocurrency exchanges Binance and OKX. In addition to bitcoin, respondents named Ethereum, Solana, BNB, and the meme coin PEPE as the most profitable assets.

– The personal account of MicroStrategy founder Michael Saylor holds bitcoins worth $1 billion. He revealed this figure himself in a recent interview with Bloomberg. However, four years ago, it was known that the businessman owned more than 17,000 coins.
Saylor is known for his commitment to bitcoin. And this is well-founded—over the past four years, MicroStrategy has invested about $8.4 billion in this asset, bringing its reserve to 226,500 coins, which has yielded a profit of more than $5 billion. As a result, the company's shares have risen in value by 995%. During the same period, the leading cryptocurrency has appreciated by approximately 500%.

– The Ripple (XRP) token is displaying a bullish signal, pleasing the bulls of this altcoin. Technical indicators point to an inverted "Head and Shoulders" pattern on the daily chart of the altcoin, with the second shoulder almost ready to form.
Since the court ruling in the case between the SEC (the U.S. Securities and Exchange Commission) and Ripple, the XRP token has been correlating with major cryptocurrencies such as bitcoin, Ethereum, and Solana. Leaning on the $0.55 support, it has been trading in a narrow sideways trend along with the aforementioned assets since the 50% decline that followed the court ruling. As a result, Ripple has recently begun to form the base of the second shoulder in the bullish pattern with a potential risk-to-reward ratio of 1:2.

– The U.S. Federal Reserve and the Treasury-controlled Financial Crimes Enforcement Network (FinCEN) have proposed amendments to the Bank Secrecy Act, equating the "rights and obligations" of the dollar and cryptocurrencies. After revising the definition of "money" in this Act, federal supervisory authorities will be able to impose new reporting requirements on financial institutions to track all domestic and cross-border cryptocurrency transactions. The amendments, if approved by Congress, are scheduled to take effect in September 2025.

– The author of the bestseller "Rich Dad Poor Dad," financier Robert Kiyosaki, believes that people are wrong to turn to the U.S. Federal Reserve for support, as this institution consists of highly educated but poor employees. "The Fed cannot save you," the entrepreneur declares. "It's time to save yourself. Buy more gold, silver, bitcoin, and stop listening to highly educated poor people."
Kiyosaki predicts that in the face of the upcoming market downturn, the prices of precious metals will rise several times over. And bitcoin, in his opinion, may become the most effective protection against "theft of savings by authorities and bankers." Recall that he previously stated that key technical indicators point to a stock market crash, and against this backdrop, the price of "digital gold" could easily reach $10 million per BTC.

– Michael Van De Poppe, CEO of MN Trading, is convinced that bitcoin will reach a new peak this autumn. The main driver for its growth will be institutional investors, who actively bought the coin when its price dropped. The analyst also believes that the recent correction could trigger a strong rally in September or October of this year, as long as bitcoin itself stays above the $57,000 mark.
Approximately the same timeline for the start of the bull rally was predicted by the analyst known as Rekt Capital. He suggested that about 160 days after the halving, bitcoin will enter a parabolic phase. According to his calculations, this should happen at the end of September 2024.

– Matthew Sigel, Head of Digital Assets Research at VanEck, is also optimistic. He believes that bitcoin will approach its all-time high immediately after the U.S. presidential election: "A typical seasonal pattern is observed where the first cryptocurrency usually struggles between one and three months after the halving," he writes. "Thanks to the influx of liquidity, bitcoin should soon show growth."
The analyst pointed to the weakening of the forced sales factor and predicts that bitcoin will follow gold. According to VanEck's top executive, in 2025, financial markets will be influenced by a monetary policy easing, and because of this, BTC will surpass its all-time high.
According to Matthew Sigel, regardless of who becomes the next U.S. president, the market should be prepared for four years of reckless fiscal policy, and it is during this period that the first cryptocurrency will reach its peak values.
Let us remind you that the digital asset management company VanEck recently released a new forecast for bitcoin. It envisages three possible BTC price levels depending on the development of the market and the adoption of bitcoin as a reserve asset worldwide. According to the base scenario, by 2050, the flagship cryptocurrency could reach $3 million per coin. In the bearish scenario, the minimum BTC price will be $130,314. If the VanEck bullish scenario comes true, in 26 years, 1 bitcoin will be worth $52.4 million.

EUR/USD: Wall Street Triumphs Over the Dollar


● The Dollar Index (DXY) fell throughout the beginning of the week, while the EUR/USD pair rose. This was due to the after-effects of the "Grey Friday" on August 2 and the "Black Monday" on August 5, which we covered in detail in our previous review. The EUR/USD pair reached a local high of 1.1046 after the release of the US Consumer Price Index (CPI) for July on Wednesday, August 14. The data showed that annual inflation had fallen to 2.9%, below both the previous reading and the forecast of 3.0%. The Core Consumer Price Index (Core CPI), which excludes volatile food and energy prices, rose by 3.2% year-on-year in July compared to 3.3% in June.
● This decrease in inflationary pressure, despite the CPI still being above the Fed's target level of 2.0%, has strengthened the argument that the regulator may lower interest rates at its September meeting. Analysts had already considered such a move highly likely, given other indicators pointing to a slowdown in the US economy. Among these indicators are the lowest Manufacturing Business Activity Index in eight months and the rise in unemployment to 4.3%. According to strategists at Principal Asset Management, the current CPI data "eliminate any obstacles related to persistent inflation that could have prevented the Fed from beginning a rate-cutting cycle in September."
(Remember that the Federal Reserve started raising interest rates to combat inflation, which reached 9.1% in July 2022, a record high in many decades. As a result of this tightening (QT), after a year, in July 2023, the rate reached a 23-year high of 5.50%, where it remains to this day).
After the release of inflation data on August 14, stock indices (S&P500, Dow Jones, Nasdaq) rose. The DXY reached a minimum but then slightly strengthened, as the CPI figures were far from radically changing the situation.
● Thursday, August 15, brought another batch of important data from the US. After declining by -0.2% in June, retail sales in July exceeded the forecast of 0.3% and rose by 1.0%. This marked the fastest growth since the beginning of 2023. Market participants also closely monitored the US labour market data following the disappointing figures of "Black Friday." This time, the data was positive: initial jobless claims for the week amounted to 227K, which was lower than both the previous figure of 234K and the forecast of 236K. Additionally, the world's largest retailer, Walmart, reported increased revenue and raised its profit forecast.
Weak consumer spending typically leads to layoffs and higher unemployment, which reduces people's ability to spend. In contrast, the growth in retail sales and Walmart's performance indicate a revival in the consumer market. Yes, the US economy's growth is still slowing, but fears of a recession, if not entirely gone, have at least significantly diminished.
These news events, on the one hand, dispelled the spectre of a recession but, on the other, reinforced confidence in a Fed rate cut in September. As a result, the DXY rose alongside Wall Street stock prices. It is quite rare for a safe-haven asset to rise in parallel with investor risk appetites, but that's exactly what happened this time. However, it was the stock indices that held back the dollar's bull rally, preventing it from strengthening further. In the end, the pressure on the dollar from the stock exchanges was so strong that the EUR/USD pair turned north and ended the week at 1.1027.
● According to forecasts, the Fed is expected to lower interest rates by a total of 95-100 basis points (bps) by the end of the year. Currently, the US Central Bank is inclined to cut the rate by 25 bps in September. However, if the August labour market report disappoints traders again, the FOMC (Federal Open Market Committee) may be forced to lower the rate by 50 bps at once—from 5.50% to 5.00%, which could significantly weaken the US dollar's position.
As of the evening of August 16, at the time of writing this review, 60% of analysts favoured the dollar's strengthening and the pair's movement to the south, while 40% supported the euro's strengthening. In technical analysis, all 100% of trend indicators and oscillators on the D1 chart point to the north, although 20% of the latter are in the overbought zone. The nearest support for the pair is located in the 1.0985 zone, followed by 1.0950, 1.0890-1.0910, 1.0825, 1.0775-1.0805, 1.0725, 1.0665-1.0680, and 1.0600-1.0620. Resistance zones are found in the areas of 1.1045, 1.1100-1.1140, 1.1240-1.1275, 1.1350, and 1.1480-1.1505.
● In the upcoming week, on Tuesday, August 20, the Eurozone inflation figures (CPI) will be released. The following day, the minutes of the latest FOMC meeting will be published. On Thursday, August 22, business activity indicators (PMI) will be released for various sectors of the German economy, the Eurozone as a whole, and the United States. Additionally, the traditional weekly statistics on initial jobless claims in the United States will be published on that day. Also on Thursday, the Annual Economic Symposium in Jackson Hole (USA) will commence, running through Saturday. This important event, dedicated to monetary policy issues, has been held since 1981 and brings together Central Bank leaders and leading economists from many countries around the world.


GBP/USD: The British Pound Gains Strength


● The dynamics of the GBP/USD pair were naturally influenced not only by macroeconomic statistics from the US but also by economic data coming out of the UK. Last week saw a considerable amount of such data.
The acceleration of the pound's growth occurred against the backdrop of strong unemployment figures from the UK, which exceeded expectations. On Tuesday, August 13, it was revealed that the unemployment rate fell in June, reaching 4.2%. This represents a significant improvement compared to May, when the rate was 4.4%. Given that the forecast predicted a rate of 4.5%, this data made a strong impression on the market. Such a decrease in unemployment indicates positive changes in the labour market and could be a sign of economic stabilization, contributing to increased investments.
● The following day, on Wednesday, August 14, consumer inflation data was released. The Office for National Statistics reported that the CPI rose for the first time this year to 2.2% year-on-year. This increase followed two consecutive months of remaining at the Bank of England's (BoE) target level of 2.0%. Although the result was slightly below the forecast of 2.3%, the pound experienced only a minor and brief decline against the dollar, as markets raised the probability of a 25 bps rate cut by the BoE in September from 36% to 44%.
It is worth noting that inflation in the UK reached a 41-year high of 11.1% in October 2022. This was driven by a sharp rise in energy and food prices following Russia's invasion of Ukraine, as well as labour shortages due to COVID-19 and supply chain disruptions. However, thanks to a well-thought-out monetary policy, price pressures were significantly reduced, and consumer inflation in the UK is now lower than in the Eurozone and the US. However, the Bank of England expects the CPI to rise, reaching approximately 2.75% by the end of the year, as the impact of the sharp drop in energy prices in 2023 fades. According to BoE economists, the CPI is expected to return to the target of 2.0% only in the first half of 2026.
According to some experts, much (if not all) of the GBP/USD pair's behaviour will depend on the pace of monetary policy easing by the Fed and the BoE. If the US interest rate is lowered aggressively while the Bank of England delays similar measures until the end of 2024, the bulls on the pound may have a good opportunity to push the pair towards the 1.3000 level.
● On Thursday, August 15, the British currency continued to strengthen following the release of strong GDP data. The UK's Office for National Statistics (ONS) reported that the economy grew by 0.6% quarter-on-quarter in the second quarter. On an annual basis, growth reached 0.9% compared to 0.3% in the previous quarter. According to analysts, these figures confirm the trend of the country's economic recovery after the recession, despite the impact of widespread strikes and poor weather, which slowed consumption in June.
● The GBP/USD pair closed the week at 1.2944. Economists at Scotiabank expect further growth towards the 1.2950-1.3000 range. As for the average forecast, 30% of experts support Scotiabank’s view, 50% anticipate a strengthening of the dollar and a decline in the pair, while the remaining 20% remain neutral.

Regarding technical analysis on the D1 chart, similar to the EUR/USD situation, all 100% of trend indicators and oscillators point to the north (with 15% of the latter indicating overbought conditions). In case the pair falls, it will encounter support levels and zones around 1.2900, followed by 1.2850, 1.2795-1.2815, 1.2750, 1.2665-1.2675, 1.2610-1.2620, 1.2500-1.2550, 1.2445-1.2465, 1.2405, and 1.2300-1.2330. If the pair rises, it will face resistance at 1.2980-1.3010, followed by 1.3040, 1.3100-1.3140, 1.3305, and 1.3425.
● In the upcoming week, the calendar highlights Thursday, August 22, when, along with business activity data from the Eurozone and the US, similar PMI figures from S&P Global for the UK will be published. At the very end of the workweek, on Friday, August 23, a speech by the Governor of the Bank of England, Andrew Bailey, is expected.

USD/JPY: A Very Quiet Week

● The past week was surprisingly calm for the USD/JPY pair. Some activity was observed with the release of several Japanese economic indicators on Thursday, August 15. According to preliminary data, the country's economy grew by +0.8% in Q2 (market expectations were +0.5%). This was a significant improvement, as GDP had declined by -0.6% in Q1 2024. Similarly, in annual terms, GDP growth reached +3.1% after a contraction of -2.3% in the previous quarter.
Consumer spending rose for the first time in five quarters, increasing by 1.0% in April-June. This was driven by an increase in average wages in the country by more than 5% following spring negotiations between companies and trade unions, marking the largest increase in over 30 years.
● After the release of this data, the USD/JPY pair showed a slight increase, but then retraced downward, ending the workweek at 147.60. The analysts' forecast for the near term is as follows: one-third expect the pair to move upward, one-third anticipate a decline, and the remaining third have taken a neutral stance. Among trend indicators on the D1 chart, 75% are coloured red, and 25% are green. Among oscillators, 50% align with the red, 25% with the green, and the remaining 25% are in neutral grey.
The nearest support level is in the 146.55-146.90 zone, followed by 145.39, 143.75-144.05, 141.70-142.15, 140.25-140.60, 138.40-138.75, 138.05, 137.20, 135.35, 133.75, 130.65, and 129.60. The nearest resistance is located in the 148.20 zone, followed by 149.35, 150.00, 150.85, 151.95, 153.15, 154.20, then 154.85-155.20, 156.80-157.20, 157.70-158.25, 158.75-159.00, 160.20, 160.85, and 161.80-162.00, with further resistance at 162.50.
● No significant events or macroeconomic data releases related to the state of the Japanese economy are scheduled for the upcoming week.


CRYPTOCURRENCIES: Bitcoin's Snake Trend

● Unlike the first ten days of August, the past week was relatively calm. Bitcoin, of course, continued to react to US macroeconomic data, but unlike stock indices and the dollar, the reaction of the leading crypto asset was rather muted. The BTC/USD pair moved in a narrow sideways channel, slightly undulating between resistance at $62,000 and support at $58,000. (Two timid attempts to break below this support don't really count).
● According to analysts, at the current price of bitcoin, many public mining companies are in a difficult financial position. This is due to both the increased complexity of computations and the drop in revenues following the halving. Miners faced another blow on the last day of July. It is important to note that the mining difficulty is adjusted every two weeks based on the total power of the mining equipment in use. This adjustment is necessary to maintain the block mining speed at roughly one every 10 minutes. On July 31, the difficulty increased by 10.5%—the largest jump since October 2022.
As a result, according to Ki Young Ju, CEO of the analytical firm CryptoQuant, the average cost of mining one bitcoin is currently around $43,000. While this figure is lower than the current price of BTC, it does not take into account the repayment of loans previously taken out for the construction of data centres and the purchase of equipment, as well as various overhead and administrative expenses.
Experts at TheMinerMag, based on financial reports for Q2, calculated the total cost of the coins mined in July for leading mining companies. It turns out that companies like Marathon Digital and Riot are operating at a loss. However, they continue to accumulate digital gold reserves, betting on its future price increase.
● It's worth noting that Marathon Digital is currently the largest miner in the world, with a market capitalization of $4.44 billion. According to company representatives, Marathon views bitcoin as its "primary strategic treasury asset." In addition to mining, Marathon is also increasing its reserves by "applying a multifaceted strategy for purchasing bitcoins." Just recently, the company bought additional digital gold worth $249 million, issuing bonds maturing in 2031 to finance the purchase. The average purchase price was around $59,500 per coin, bringing Marathon's total holdings to over 25,000 BTC (approximately $1.48 billion). This significant investment reflects the company's confidence in the continued price growth of the leading cryptocurrency.
● Another major player exuding confidence is MicroStrategy, which has announced the potential addition of up to $2 billion to its already massive bitcoin portfolio. According to the company's financial report, in the second quarter, it acquired 12,222 BTC for $805.2 million, bringing its total bitcoin holdings to 226,500 coins (worth more than $13 billion at current prices).
Over the past four years, MicroStrategy has invested approximately $8.4 billion in BTC, yielding a profit of more than $5 billion. As a result, the company's stock price has increased by 995% since 2020. Interestingly, Arkham has even created a dedicated portal to track MicroStrategy's bitcoin purchases. The potential injection of another $2 billion into BTC will undoubtedly attract significant attention from market participants.
● Data from the analytics firm Glassnode also confirms that large investors have shifted towards long-term accumulation of bitcoins. The Accumulation Trend Score (ATS) metric, which evaluates changes in market balances, has recorded the highest possible value of 1.0. This indicates significant bitcoin accumulation in recent times. Previously, PitchBook reported that venture capital investments in the crypto industry increased by 2.5% from April to June, marking the third consecutive quarter of positive capital inflows.
● According to experts at Santiment, renewed market excitement could push bitcoin back to the $70,000 zone, with a subsequent achievement of a new all-time high at $75,000 in the short term. The analyst known as TheScalpingPro also believes that despite the recent dip, bitcoin is capable of a bullish rally. In his view, the leading cryptocurrency is forming a classic parabolic curve, often associated with a strong upward momentum. This curve suggests that within a 6-12 month horizon, BTC could experience rapid growth with a potential target of around $180,000, followed by a sharp correction.
Another analyst, TheMoonCarl, suggests that a decisive breakout and consolidation above the $60,000 resistance could lead to a rise to $125,000. This forecast is based on the formation of a "cup and handle" pattern. TheMoonCarl cited BTC's price movement in 2021 as an example, noting that if bitcoin reaches the $70,000 level, the next target could be $125,000.
● CryptoQuant holds a different view, believing that in the short term, bitcoin does not show signs of recovery. The high volatility of cryptocurrencies, the decline in stocks of leading technology companies associated with artificial intelligence, such as Nvidia, Google, and Microsoft, combined with rising geopolitical tensions, are pushing investors to seek safer investments, such as physical gold. On Wednesday, August 13, the price of gold reached another all-time high of $2,477, and according to some experts, this precious metal has a strong chance of rising to $3,000 by the end of the year.
● Long-term forecasts for bitcoin remain extremely impressive, ranging from total collapse to soaring to the Moon and beyond—to the edges of the Solar System. For instance, the digital asset management company VanEck has released a new forecast that outlines three potential price levels for BTC, depending on market development and the global adoption of bitcoin as a reserve asset. According to the base scenario, by 2050, the flagship cryptocurrency could reach $3 million per coin. In the bearish scenario, the minimum value of BTC would be $130,314. However, if VanEck's bullish scenario comes to pass, in 26 years, one bitcoin could be worth $52.4 million, nearly 900 times more than its current value.
● Unfortunately, as of the evening of Friday, August 16, at the time of writing this review, the BTC/USD pair has yet to reach $50 million or even $3 million and is trading at $59,300. The total cryptocurrency market capitalization stands at $2.08 trillion (down from $2.11 trillion a week ago). The Crypto Fear & Greed Index has dropped from 48 to 27 points, shifting from the Neutral zone into the Fear zone.
● In conclusion, a few words about… copyrights. This is precisely what we want to secure for ourselves. Let us explain. Everyone knows that an upward trend is called bullish, and a downward trend is bearish. But what do we call a sideways trend? No name? Now, take a look at the BTC/USD chart from this week: does it remind you of anything? Yes, it’s like a snake slithering and winding along the ground. This is why we propose calling the sideways trend from now on the "Snake Trend," and we officially request that the authorship of this term be attributed to us.



NordFX Analytical Group
 

Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.