Topic: Nordfx broker: news, weekly Analytics - page 10. (Read 50194 times)

EUR/USD: Awaiting Fed and ECB Meetings


The main factor determining the dynamics of the US Dollar Index (DXY) and, consequently, the EUR/USD pair last week was… silence. If recently, the speeches of Federal Reserve representatives were almost the most important market guide, then a silence regime has been in effect since April 21. Leading up to the press conference by Fed Chairman Jerome Powell following the FOMC's May meeting, all officials are instructed to maintain silence. Only a few days remain until the FOMC (Federal Open Market Committee) meeting, where a decision regarding the regulator's future monetary policy will be made, scheduled for May 2/3. Furthermore, on Thursday, May 4, there will be a meeting of the European Central Bank, where an interest rate decision will also be made. In general, the upcoming five-day period promises to be, at the very least, not dull.

Of course, macroeconomic data and events from both sides of the Atlantic caused certain fluctuations in EUR/USD last week. However, the final result was close to zero: if on Friday, May 21, the last chord sounded at the 1.0988 mark, then on Friday, May 28, it was placed not far away: at the 1.1015 level.

One event worth highlighting was the publication of the First Republic Bank (FRC) report, which ranks among the top 30 US banks by market capitalization. It was this report that led to the dollar's decline and the pair's surge by more than 100 points on Wednesday, April 26.

It seemed that the banking crisis caused by the tightening of the Federal Reserve's monetary policy (QT) was beginning to fade... US Treasury Secretary Janet Yellen even assured the public of the resilience of the banking sector. But then... a new flare-up called First Republic Bank (FRC). To prevent its bankruptcy and support its liquidity in Q1 2023, a consortium of banks transferred $30 billion in uninsured deposits to FRC. Another $70 billion in the form of credit was provided by JPMorgan. However, this was not enough: the bank's clients began to scatter, and FRC shares collapsed by 45% in two days and by 95% since the beginning of the year. In March alone, clients withdrew $100 billion from the bank. Thus, First Republic Bank has a very high chance of becoming number 4 in the lineup of bankrupted major US banks. And if the Fed does not stop its QT cycle, there is a very high probability that numbers 5, 6, 7, and so on will appear on this list.

However, as we have already detailed in our previous review, at the meeting on May 2/3, the key rate will be raised by only 25 basis points (FedWatch from CME estimates the probability of this at 72%). After that, the US Central bank is likely to take a pause. As stated by the President of the Federal Reserve Bank of Atlanta, Raphael Bostic, "one more increase should be enough for us to step back and see how our policy is reflected in the economy." It should be noted that the 25 bp rate hike has long been factored into market quotations. Therefore, immediately after the news about FRC and the surge to 1.1095, EUR/USD returned to a comfortable state for itself.

At the time of writing the review, on Friday evening, April 28, analysts' opinions were divided as follows: 35% of them expect the dollar to weaken and the pair to rise, 50% expect it to strengthen, and the remaining 15% have taken a neutral position. As for technical analysis, among oscillators on D1, 85% are coloured green, 15% are neutral-grey, among trend indicators, 90% are green, and 10% have changed to red. The nearest support for the pair is located in the area of 1.0985-1.1000, followed by 1.0925-1.0955, 1.0865-1.0885, 1.0740-1.0760, 1.0675-1.0710, 1.0620, and 1.0490-1.0530. Bulls will encounter resistance in the area of 1.1050-1.1070, then 1.1110, 1.1230, 1.1280, and 1.1355-1.1390.

In addition to the aforementioned FOMC and ECB meetings, we can expect a substantial amount of economic data next week. On Monday, May 1, the ISM Manufacturing PMI for the US will be published. The next day, the value of a similar index, but for Germany, will become known. Also, on Tuesday, May 2, we will learn about the inflation situation in the Eurozone, as the Consumer Price Index (CPI) will be released. Furthermore, on May 2, 3, 4, and 5, we will get a flurry of US labour market data. Important indicators such as the unemployment rate and the number of new non-farm jobs in the US (NFP) are among these, they will traditionally be published on the first Friday of the month, May 5.

GBP/USD: BoE vs. Fed: Who Will Win the Battle of Interest Rates?

The Bank of England (BoE) meeting will take place a week after the Fed's meeting, on Thursday, May 11. Most experts believe that the cycle of interest rate hikes for the pound is not yet over, which supports the British currency.

Recent data on inflation for March contribute to these forecasts. The Consumer Price Index (CPI) in annual terms once again reached a double-digit figure, 10.1%, which is higher than the forecast of 9.8%. To bring this indicator below the psychologically important mark of 10.0%, the BoE is highly likely to continue following the Fed's example. Market participants expect the regulator to raise the interest rate by 50 basis points on May 11: from 4.25% to 4.75%. No more effective ways to curb inflation have been devised so far. And if it continues to remain so high, it will harm both the consumer market and the overall UK economy.

Since the beginning of April, we have observed a sideways trend. However, GBP/USD finished the past five-day period at the 1.2566 mark, unexpectedly breaking the upper boundary of the channel. Perhaps the reason for the jump was the closing of trading positions at the end of the month. Currently, 75% of experts are in favor of the dollar, and only 25% side with the British pound. Among oscillators on D1, the balance of power is as follows: 85% vote in favor of the green (with a third of them being in the overbought zone), and the remaining 15% have turned neutral-grey. Trend indicators are 100% on the green side. Support levels and zones for the pair are 1.2450-1.2480, 1.2390-1.2400, 1.2330, 1.2275, 1.2200, 1.2145, 1.2075-1.2085, 1.2000-1.2025, 1.1960, 1.1900-1.1920, and 1.1800-1.1840. As the pair moves north, it will encounter resistance at the levels of 1.2510-1.2540, 1.2575-1.2610, 1.2700, 1.2820, and 1.2940.

Regarding important statistics on the state of the UK economy for the upcoming week, on Tuesday, May 2, the Manufacturing Purchasing Managers' Index (PMI) will be published. Then, on May 4, we will learn the value of the PMI for the services sector as well as the composite business activity indicator for the UK as a whole. Traders should also be aware that there will be a bank holiday in the country on Monday, May 1.

USD/JPY: Bank of Japan - Heading for Softer Ultra-Soft Policy

Forecasting the interest rate of the Bank of Japan (BoJ) is quite simple and very, very boring. As a reminder, it is currently at a negative level of -0.1% and was last changed on January 29 of the distant 2016, when it was lowered by 20 basis points. This time around, at its meeting on Friday, April 28, the regulator left it unchanged at the same -0.1%.

But that's not all. Many market participants were expecting that with the arrival of the new Central bank governor, Kazuo Ueda, the regulator would eventually change course towards tightening. However, contrary to these expectations, during his first press conference following his first meeting on April 28, Ueda stated, "We will continue to ease monetary policy without hesitation if necessary." One might wonder how much softer it could get, but it turns out that the current -0.1% is not the limit.

The result of the BoJ governor's words can be seen on the chart: in just a few hours, USD/JPY soared from 133.30 to 136.55, weakening the yen by 325 points. Of course, it's still far from the October 2022 peak, but a rise to the 137.50 level no longer seems entirely unrealistic.

The pair ended the past week at the level of 136.30. Regarding its near-term prospects, analysts' opinions are distributed as follows: currently, only 25% of experts vote for the pair's further growth, 65% point in the opposite direction, expecting the yen to strengthen, and 10% simply shrug. Among the oscillators on D1, 85% point upward (a third of them are in the overbought zone), while the remaining 15% remain neutral. Trend indicators show 90% looking north, and 10% pointing south. The nearest support level is in the 136.00 area. Next are the levels and zones at 135.60, 134.75-135.15, 132.80-133.00, 132.00-132.40, 131.25, 130.50-130.60, 129.65, 128.00-128.15, and 127.20. Resistance levels and zones are at 137.50 and 137.90-138.00, 139.05, and 140.60.
 Regarding events characterizing the state of the Japanese economy, none are expected in the coming week. Moreover, the country is looking forward to a series of holidays: May 3 is Constitution Day, May 4 - Greenery Day, and May 5 is Children's Day. As a result, the dynamics of USD/JPY will depend entirely on what is happening on the other side of the Pacific Ocean, in the United States.

CRYPTOCURRENCIES: Awaiting the 2024 Halving

BTC/USD continued to decline on Monday, April 24 and, after breaking the support at $27,000, fell to $26,933. Market participants were already prepared to see bitcoin go even lower at the strong support level of $26,500. However, it unexpectedly soared to $30,020 on April 26. The main cryptocurrency was saved, as it has been many times before and will be many times again, by a weakened dollar. The cause of the shock was the problems of First Republic Bank, which followed a series of bankruptcies of crypto-friendly banks, as discussed above.

The correlation between the crypto and banking industries arises thanks to the following chain of events: 1) Tightening of the Federal Reserve's monetary policy hits banks, lowering their asset prices, reducing demand for their services, and causing customers to flee. 2) This situation creates serious difficulties for some banks and leads to the bankruptcy of others. 3) This can force the Fed to pause its cycle of raising interest rates or even lower them. Additionally, the regulator may restart the printing press to support bank liquidity. 4) Low rates and a flow of new cheap money lead to a decrease in the value of the dollar and allow investors to direct these funds into risky assets such as stocks and cryptocurrencies, which leads to an increase in their quotes. We have already seen this during the COVID-19 pandemic and may see it again in the near future.

According to former Goldman Sachs top manager and macro-investor Raoul Pal, the Federal Reserve (Fed) is likely to have finished its saga of raising interest rates. He has also predicted an upcoming recession that will force the regulator to "change course" and support the markets by printing money. In that case, he believes that risky assets are in for an "inevitable liquidity wave." This capital influx will "enlighten" the crypto industry with new innovations, and the number of people using digital assets will increase from the current 300 million to over 1 billion.

According to experts from the British bank Standard Chartered, bitcoin has benefited from its status as a "brand refuge" for savings at the beginning of 2023, and the current situation indicates the end of the "crypto winter". Standard Chartered believes that recent turmoil in the banking sector, stabilization of risky assets due to the end of the Fed's interest rate hike cycle, and increased profitability in the crypto mining industry will contribute to BTC's further growth. In addition, the adoption of the first EU framework for regulating crypto markets by the European Parliament could also support the leading cryptocurrency. The upcoming halving event will also impact BTC's growth, with bitcoin potentially reaching $100,000 by the end of 2024.

It should be noted that the topic of halving is becoming more and more prevalent. The Bitcoin Archive press service reminds us that it is less than a year away, with the procedure scheduled for April 6, 2024, as of April 24, 2023. However, this date is not final and may change, as it has in the past.

Some market participants believe that this event will be crucial for the future price of the flagship cryptocurrency. They believe that cycles for cryptocurrencies are consistent, and BTC quotes will reach new record highs a year or a year and a half after halving, as happened in previous cycles. Others argue that the market situation has changed. Bitcoin has become a mass phenomenon, and now "other laws and rules apply to the cryptocurrency", so other factors will become decisive, not just the halving of mining rewards.

It is worth noting that the second group of specialists includes Bloomberg Intelligence analyst Jamie Coutts, who predicts that the price of bitcoin will rise to $50,000 before April 2024. "The price of bitcoin bottoms out when there are 12-18 months left until the halving. The structure of the current cycle is similar to previous ones. However, many factors have changed: the network has become significantly more resilient, and bitcoin has never experienced a prolonged economic downturn," Coutts said. If his forecast is correct, the asset will appreciate by about 220% from the low reached last November before the halving.

The expert and trader known as Doctor Profit reminded of his previous statement that the bottom for bitcoin was reached at the level of $15,400, and it is unlikely that we will see another drop to this level. The dump in November 2022 was a complete capitulation, including for bitcoin miners, some of whom were forced to sell their coins and equipment at a loss. According to Doctor Profit, BTC is currently in an accumulation phase, neither in a bull nor in a bear market. At the same time, the specialist has advised traders to closely monitor the correlation between the Chinese stock market and bitcoin, believing that China will lift the ban on cryptocurrencies and legalize them, which will have a very positive long-term effect on their price.

Another analyst under the nickname DonAlt also excludes a drop in BTC/USD to the lows of November 2022. At the same time, he allows for a correction down to $20,000, which, in his opinion, will be a good level to replenish the reserves of the main cryptocurrency.

It's been a while since we quoted the popular analyst under the nickname PlanB, known for his Stock-to-Flow (S2F) model. He continues to assert that the predictions he makes based on this model continue to come true. "Before the halving, we can expect $32,000 for bitcoin, then $60,000. Then [after the halving] $100,000 will become the minimum, and the maximum rate could reach $1 million. But on average, after the next halving, the BTC rate should reach $542,000," wrote PlanB. At the same time, the analyst emphasized that the behaviour of the crypto market fully corresponds to S2F, so its critics are simply unfounded.

It is worth noting that PlanB is not alone in his super-optimistic predictions for the price of bitcoin, which legendary Warren Buffett called "rat poison squared." Robert Kiyosaki, the author of the popular book Rich Dad Poor Dad, believes that the value of the flagship cryptocurrency will rise to $500,000 by 2025. And at Ark Invest, looking a decade ahead, they named a figure of $1 million per coin.

As of the evening of Friday, April 28, BTC/USD is trading at $29,345. The total market capitalization of the crypto market is $1.205 trillion ($1.153 trillion a week ago). The Crypto Fear & Greed Index has increased from 50 to 64 points over the past seven days, moving from Neutral to the Greed 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.

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NordFX brokerage company has summed up the performance of its clients' trade transactions in April 2023. The services of social trading, PAMM and CopyTrading, as well as the profit received by the company's IB-partners have also been assessed.

- The maximum profit this month was earned by a client from East Asia, account №1543XXX, who made 25,086 USD through transactions with gold (XAU/USD), bitcoin (BTC/USD), and the Japanese Yen (USD/JPY).

- The second place in the Top 3 was taken by a trader from Southeast Asia, account №1686XXX, with a result of 23,341 USD, which was also achieved through transactions with gold (XAU/USD).

- The same precious metal allowed the owner of account №1687XXX from East Asia to earn a profit of 22,250 USD and secure the third position on the pedestal of honor.

The situation in NordFX passive investment services is as follows:

- In CopyTrading, the long-standing signal "veteran" with a complex name, KennyFXPRO - Prismo 2K, continues to be noticeable. Its profit amounted to 348% over the course of 726 days. Let us remind you that this signal faced significant challenges last November, as the maximum drawdown surpassed 67%. In all fairness, it should be noted that such an impressive failure was a one-time occurrence, and KennyFXPRO - Prismo 2K has been fairly stable for the rest of the time.
The same provider introduced another signal last December, with an even more intricate name: KennyFXPRO - Variables_RBB 35. In its 144 days of existence, it has demonstrated a modest 27% profit with a reasonably moderate 24% drawdown. If the provider of this signal manages to prevent it from experiencing more serious setbacks, it could potentially become a strong competitor to its "senior colleague" in the future.

The performance of the signal ATFOREXACADEMY ALGO 1, which we discussed in our previous review, ended in disaster. During its initial 100 days, it exhibited a remarkably high yield of 202%. However, April proved to be extremely unfavorable for it, with a drawdown of over 90%, once again reminding us that trading in financial markets is a highly risky endeavor.

Lastly, in reviewing April, the startup signal Trade2win deserves attention. Existing for just one month, it has shown an impressive outcome on gold trades, with a return of 2,290% and a maximum drawdown of less than 15%. Relentless statistics indicate that even less aggressive trading strategies can lead to a complete loss of funds, thus investors must exercise extreme caution. We will observe and see what happens with this signal in May.

 - Two accounts, which we have previously mentioned in our past reviews, are still present on the PAMM service showcase. These are KennyFXPRO-The Multi 3000 EA and TranquilityFX-The Genesis v3. They suffered serious losses in mid-November 2022: the drawdown at that moment approached 43%. However, the PAMM managers have decided not to give up, and as of April 30, 2023, the profit on the first account has approached 90%, while on the second account it has surpassed 58%.

In April, we continued to monitor the Trade and earn account. It was opened more than a year ago, but was in a state of hibernation, waking up only in November. As a result, the yield on it has exceeded 76% over the past 6 months with a very small drawdown of less than 10%.

Among the IB partners, NordFX TOP-3 is as follows:
- the largest commission, 5,348 USD, was credited to a partner from West Asia, account No.1621XXX;
- next is partner from South Asia, account No.1618XXX, who received 3,991 USD;
- finally, their compatriot with account №1517XXX completes the top three, earning a reward of $3,876 USD.

***

In summarizing the month, it is important to remind traders that they now have an excellent opportunity to boost their budget. NordFX has launched another super lottery for its clients this year, in which over 200 cash prizes totaling 100,000 USD will be drawn. It is very easy to take part in the lottery and get a chance to win one or even several of these prizes. All the details are available on the NordFX website.
 

Notice: These materials should not be deemed a recommendation for investment or guidance for working on financial markets: they are for informative purposes only. Trading on financial markets is risky and can lead to a loss of money deposited.

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Participation in the NordFX Super Lottery is a great opportunity to improve your financial situation by winning one or even several large cash prizes. The total prize pool is $100,000 and is divided in 2023 into 202 prizes from $250 to $1,800 plus 3 super prizes of $5,000 each.

The organizer of the Super Lottery is NordFX, an international brokerage company with 15 years of experience in financial markets, which is trusted by clients from 188 countries around the world. All information about the terms of the Super Lottery can be found on the broker's official website NordFX.

As early as 1748, Benjamin Franklin, whose portrait adorns the $100 bill, formulated one of the main financial laws: Time is Money. So, hurry up and don't waste time: the sooner you participate in the lottery (which is not difficult at all), the more likely you are to win there!
 

Notice: These materials should not be deemed a recommendation for investment or guidance for working on financial markets: they are for informative purposes only. Trading on financial markets is risky and can lead to a loss of money deposited.

#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #cryptocurrencies #bitcoin #stock_market

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CryptoNews of the Week


- According to experts from the British bank Standard Chartered, bitcoin could reach $100,000 by the end of 2024, which indicates the end of the so-called "crypto winter", writes Reuters. Standard Chartered believes that at the beginning of 2023 bitcoin profitably took advantage of its status as a "brand haven" for savings and a tool for money transfers. Its further growth will be facilitated by recent turmoil in the banking sector, stabilization of risky assets due to the end of the US Federal Reserve's interest rate hike cycle and increased profitability in crypto mining.
In addition, support for the main cryptocurrency may be provided by the adoption by the European Parliament of the first set of EU rules on the regulation of crypto-asset markets. According to JPMorgan experts, the growth of BTC will also be affected by halving in April 2024.

- The Bitcoin Archive press service reminded that there is less than a year left until the next bitcoin halving. As of April 24, 2023, this procedure is scheduled for April 06, 2024. However, this date is not final and may change, as it has already happened many times before.
A number of market participants believe that this event will be very important for the future value of the flagship cryptocurrency. In their opinion, the cycles for the cryptocurrency are unchanged, and BTC quotes will reach new all-time highs a year or a year and a half after the halving, as happened in previous cycles. Other experts note that the market situation has changed. Bitcoin has become a mass phenomenon and now "other laws and regulations have started to work" for cryptocurrency, so other factors will be decisive, rather than halving.

- Former Goldman Sachs top manager and macro investor Raoul Pal says that the crypto sector will increase from the current 300 million to more than 1 billion users during the next bull cycle. According to him, risky assets like cryptocurrencies are facing an "inevitable wave of liquidity." And such an influx of capital will "illuminate" the industry with new innovations.
The macro investor believes that the Fed has most likely already completed the interest rate hike. He also speaks about the approaching recession, which will force the regulator to "change course" and support the markets by printing money. "This is exactly what happened in 2019 after the Fed's reversal in 2018. The agency will pause very soon or has already done so," Raul Pal explained.

- According to a recent study by DaapGamble, more than a third of TikTok crypto influencers have posted misleading videos about cryptocurrencies and investing in them. Influencers sometimes share unverified misinformation in an attempt to convince inexperienced viewers to invest their money or their parents' money (since many TikTok users are young people) in cryptocurrencies, which leads to a loss of funds. Celebrities such as Kim Kardashian, who was ordered by the US Securities and Exchange Commission (SEC) to pay a fine of $1.26 million for promoting EthereumMax (EMAX), have been criticized.

- After reports of the activation of a bitcoin wallet with 1000 BTC worth more than $27 million, which has been asleep for 12 years, the host of the CNBC program "Crypto Trader" Ran Neuner expressed concern about what was happening. He fears hacking wallets by a special generator, the work of which is based on Artificial Intelligence. "Activating these old BTC addresses can be a really scary phenomenon," Ran Neuner was alarmed. - I hope it's not about hacking. Otherwise, all this can have catastrophic consequences".
It should be noted that such a case of unexpected awakening is far from being the only one. So, an awakened bitcoin whale of the Satoshi era has recently suddenly scattered 400 BTC to several new addresses. And last week, the Whale Alert service reported that another whale with 1128 BTC, after 10.5 years of inactivity, transferred more than 279 BTC worth $7.6 million to new wallets.
These strange events are taking place against the backdrop of a general surge in activity on the bitcoin network: according to Glassnode, the number of transactions exceeds 270,000 per day at the moment, approaching the average monthly cycle highs.

- Billionaire venture capitalist Chamath Palihapitiya believes that US regulators have "strangled" the cryptocurrency sector, which is now "on the verge of survival" in the United States. This is done out of concern that digital assets could undermine the dominance of the dollar. However, this will only lead to the fact that American crypto companies will be pushed abroad, and the country will be deprived of opportunities for innovation.
"Cryptocurrencies are dead in America. SEC Chairman Gary Gensler blames crypto assets even for the banking crisis, so it's safe to say that the United States authorities have firmly pointed their weapons at them," Palihapitiya said. The billionaire added that now the main blow of regulators is being taken by good players in the crypto industry, who pay for the collapse of the FTX exchange and the bankruptcy of cryptocurrency hedge funds that "planted a stain" on the reputation of the industry.

- An analyst aka DonAlt, who has repeatedly given an accurate forecast for the price movement of bitcoin, believes that the coin is now ready to return to the level of $30,000. At the same time, he allows a correction up to $20,000, which, in his opinion, should be considered a good level for replenishing the stocks of the main cryptocurrency. At the same time, DonAlt excludes its fall to the lows of November 2022 around $15,400.

- An expert and trader under the nickname Doctor Profit recalled his words that bitcoin groped the bottom at the level of $15,400 and it is unlikely that we will see a repeated decline to this mark. According to him, this dump in November 2022 was a complete capitulation, including for bitcoin miners, some of whom were forced to sell the mined coins and their equipment at a loss.
In his opinion, the market is neither in a bull nor in a bear market now, but in an accumulation phase. At the same time, Dr. Profit has advised traders to closely monitor the correlation between the Chinese stock market and BTC. He believes that China will lift the ban on cryptocurrency and legalize it, which will have a very positive impact on the price of cryptocurrencies in the long run.

- Bloomberg Intelligence analyst Jamie Coutts predicts a rise in bitcoin to $50,000 even before halving in April 2024. "The price of bitcoin sinks to the bottom when there are 12-18 months left before the halving. The structure of the current cycle is similar to the previous ones. Nevertheless, many factors have changed: the network has become noticeably more stable, but bitcoin has never experienced a long economic downturn, "said Coutts. If his prediction turns out to be correct, bitcoin will rise in price by about 220% by April 2024 from the bottom reached in last November.

- A popular analyst under the nickname PlanB, known for his Stock-to-Flow model, expects bitcoin to grow significantly. "My predictions continue to come true within the framework of the S2F model. Before halving, you should expect $32,000 per bitcoin, then $60,000. Then [after halving] $100,000 will be the minimum, and the maximum rate can reach $1 million. But, on average, after the next halving, the BTC rate should reach $542,000," PlanB wrote. At the same time, the analyst stressed that the behavior of the crypto market is fully consistent with S2F, so its critics are simply untenable.

- Legendary investor Warren Buffett has called bitcoin "rat poison squared." And he has recently stated that BTC is a token for gambling, noting that "it has no intrinsic value." However, statistics show that the well-known entrepreneur has been wrong in his judgments. If Buffett had added just 2.5% to his portfolio in bitcoins in 2014, this would have increased the investor's total return by 20%.


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.

#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #forex #cryptocurrencies #bitcoin #stock_market

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EUR/USD: Rate Forecast: USD +0.25%, EUR +0.50%

Due to the lack of significant economic news, the EUR/USD dynamics in recent days has been determined by statements by representatives of mega-regulators regarding interest rate hikes at the upcoming meetings of the US Federal Reserve on May 2/3 and the ECB on May 4.

The U.S. dollar index (DXY) rose following a statement from Federal Reserve representative Christopher Waller, who said that despite the most aggressive monetary policy tightening since the 1980s, the Fed has "not made substantial progress" in returning inflation to its target level of 2%, and that interest rates still need to be raised. As a result, DXY broke through the resistance of 102.00 on Monday, April 17 and reached the level of 102.22.

Raphael Bostic, President of the Federal Reserve Bank of Atlanta, seemed to support his colleague, but at the same time said that "another increase should be enough for us to step back and see how our policy affects the economy."

According to Philadelphia Fed President Patrick Harker, the US Central Bank may soon finish raising interest rates, after which there may be a pause of almost a year and a half. "Since the full impact of monetary policy measures on the economy can take up to 18 months, we will continue to carefully analyze available data to determine what additional actions we may need to take," said Harker, speaking as part of the Wharton Initiative on Financial Policy and Regulation.

Another member of the FOMC (Federal Open Market Committee), Cleveland Fed President Loretta Mester, agreed that the Fed is close to completing the rate hike cycle. However, since inflation in the U.S. remains too high, Mester believes that "the interest rate needs to be raised to a level above 5% and maintained there for some time." At the same time, Ms. Mester did not specify how much "above" 5% (as the current rate is already at 5.00%) and what duration constitutes "some time."

On Wednesday, April 19th, the Beige Book was published: an economic review by the Federal Reserve, which is based on the reporting documents of the 12 Federal Reserve Banks that make up its system. The analysis of the document's content can be summarized in the following points: 1) economic conditions have somewhat cooled in recent weeks, while inflation continues to remain relatively high; 2) wage growth has slightly slowed down but also remains high; 3) the overall price level moderately increased during the reporting period, although the pace of price growth appears to have slowed down.

Taking into account the content of the Beige Book and the statements of FOMC members, the market concluded that the regulator will raise the rate by another 25 bps (basis points) at its meeting on May 2/3, after which it will take a pause. According to the WIRP forecast, the probability of such a rate hike is now about 90%, compared to 80% at the beginning of last week and 50% at the beginning of April. And this is already included in the price. The quotes still take into account one possible rate cut at the end of the year (two cuts were previously predicted).

More clarity may appear in early summer. But two more employment reports, two CPI/PPI reports and one retail sales report will be released between the May 2/3 and June 13/14 meetings. It is clear that all these data can seriously affect the further policy of the Federal Reserve.

As for the situation on the other side of the Atlantic, the Consumer Price Index (CPI) published on Wednesday, April 19, showed that inflation in the Eurozone fell from 8.5% to 6.9% y/y. But since such a decline was fully consistent with the forecast, it did not have much impact on the pair's quotes.

The Minutes of the ECB's March monetary policy meeting were published the next day, on Thursday, May 20. According to this document, the overwhelming majority of the members of the Governing Board agreed with the proposal of Chief Economist Philip Lane to raise the key rate by 50 bps, after which it will reach 4.00%.

The situation described above led to the fact that the DXY Dollar Index consolidated in the area of 101.70-102.00, and EUR/USD stayed in the range of 1.0910-1.1000. S&P Global made a small contribution at the very end of the working week, it published preliminary data on the US Purchasing Managers' Index (PMI) for April. With a forecast of 52.8 and a previous value of 52.3, the Composite PMI came in at 53.7, which supported a certain degree of optimism regarding the state of the U.S. economy. But not for long.  As a result, EUR/USD put the last chord almost at the upper limit of the weekly channel, at around 1.0988.

At the time of writing, on the evening of Friday, April 21, analysts' opinions are divided almost equally: 35% of them expect further weakening of the dollar, 35% - its strengthening, and the remaining 30% have taken a neutral position. As for technical analysis, all the trend indicators on D1 are colored green, as for the oscillators, these are 85%, 15% have changed color to red. The nearest support for the pair is located in the area of 1.0925-1.0955, then 1.0865-1.0885, 1.0740-1.0760, 1.0675-1.0710, 1.0620 and 1.0490-1.0530. The bulls will find resistance around 1.1000-1.1015, then 1.1050-1.1070, then 1.1110, 1.1230, 1.1280 and 1.1355-1.1390.

We expect a lot of economic statistics next week, especially from the United States. The US Consumer Confidence Index will be known on Tuesday, April 25. The next day, statistics on the volume of orders for capital goods and durable goods will be received from the United States. On Thursday, April 27, data on unemployment and GDP will be known, and on Friday - on personal consumption expenditures in the United States. At the very end of the working week, there will also be a lot of information about the state of the economy of Germany, the main locomotive of the EU. These are the country's GDP indicators, unemployment data, as well as such an important indicator of inflation as the Consumer Price Index (CPI). However, one thing not to expect in the upcoming week is speeches from Federal Reserve representatives, as a silence period began on April 21 and will last until the press conference by Fed Chairman Jerome Powell following the May meeting, with no other statements being made during this time.

GBP/USD: Things Are Not as Bad, But Not as Good Either

The inflation data for March in the United Kingdom, published on Wednesday, May 19, turned out to be not very bad, but not quite good either: in March, the CPI dropped from 10.4% YoY to only 10.1%, while the market was expecting a decline to 9.8%. The fact that consumer prices remain high has given reason to expect that the Bank of England (BoE) will continue to raise interest rates. And this, in turn, supported the British currency a little.

The seasonally adjusted S&P Global/CIPS Purchasing Managers' Index (PMI) in the UK manufacturing sector, with a growth forecast of 48.5, has actually fallen from 47.9 to 46.6 over the month. On the other hand, the preliminary Index of business activity in the service sector presented a surprise: with the forecast and the March value of 52.9, it jumped to 54.9 in April. Thus, the composite PMI improved from 52.2 in March to 53.9 in April.

Commenting on this positive outcome, Dr John Glen, Chief Economist at the UK's Chartered Institute of Procurement and Supply (CIPS), said it was the fastest recovery for the year, which showed that "businesses are taking advantage of the pockets of recovery emerging in the UK economy, and activity levels have risen sharply thanks to new orders and improved supply chain performance."

The UK Office for National Statistics reported on Friday April 21 that retail sales fell 0.9% in March after a 1.1% increase in February. The data turned out to be weaker than the forecast, which suggested a decline of 0.5%, which put pressure on the pound.

GBP/USD started the past five days at 1.2414, and ended nearby at 1.2442, showing a sideways movement against the background of multidirectional statistics. At the moment, 45% of experts side with the pound and expect further growth of the pair, 35% side with the dollar and 20% vote for the continuation of the sideways trend. Among the oscillators on D1, the balance of power is as follows: 35% vote in favor of green, 25% have turned red and 40% prefer neutral gray. Trend indicators are 100% on the side of the greens. Support levels and zones for the pair are 1.2390-1.2400, 1.2330, 1.2275, 1.2200, 1.2145, 1.2075-1.2085, 1.2000-1.2025, 1.1960, 1.1900-1.1920, 1.1800-1.1840. When the pair moves north, it will face resistance at the levels of 1.2450-1.2480, 1.2510-1.2540, 1.2575-1.2610, 1.2700, 1.2820 and 1.2940.

No important statistics on the state of the UK economy are expected in the coming week.

USD/JPY: No BoJ Surprises Expected

USD/JPY rose to its highest level in six weeks, reaching the height of 135.13 on April 19. The fall of the yen was exacerbated by the data of the Ministry of Finance on Japan's trade deficit for the 2022 fiscal year. The figure was $160 billion, setting an anti-record since 1979. At the same time, the mood is quite positive in the semi-annual report of the Bank of Japan, published on April 21, since "the Japanese financial system as a whole remains stable," and the expectation of inflation falling to the target 2% runs like a red thread through all statements.

The historic meeting of the Bank of Japan (BoJ) will take place next week, on Friday, April 28. Historic not because any revolutionary decisions may be made, but because it will be the first one chaired by the new Central Bank Governor Kazuo Ueda, following the departure of Haruhiko Kuroda. Citing a number of informed sources, Reuters reported that the regulator is likely to maintain an ultra-loose monetary policy at this meeting, without making any changes to the interest rate targets and the yield corridor. Recall that the rate is at a negative level of -0.1%, and the last time it changed was on January 29 of 2016, when it was lowered by 20 bps.

Three main factors can support the yen: investor risk flight, the weakening of the dollar due to the easing of the Fed's monetary policy and a decrease in Treasury yields. Recall that there is a direct correlation between ten-year US bonds and USD/JPY. If the yield on Treasury bills falls, the yen shows growth, and the pair forms a downtrend.

USD/JPY ended the last week at the level of 134.12. Regarding its immediate prospects, the opinions of analysts are distributed as follows. At the moment, 35% of experts vote for the growth of the pair, 65% point in the opposite direction, expecting the yen to strengthen. Among the oscillators, 90% point to D1 (10% of them are in the overbought zone), the remaining 10% adhere to neutrality. Trend indicators have 75% looking to the north, 25% pointing to the south. The nearest support level is located in the 134.00 zone, followed by the levels and zones 132.80-133.00, 132.00-132.40, 131.25, 130.50-130.60, 129.65, 128.00-128.15 and 127.20. The resistance levels and zones are 134.75-135.15, 135.90-136.00, 137.00, 137.50 and 137.90-138.00.

The meeting of the BoJ and the subsequent press conference of the leadership of this regulator was mentioned above. As for the release of any important statistics on the state of the Japanese economy, it is not expected in the coming week.

CRYPTOCURRENCIES: Bitcoin Falls, but Optimism Grows


The bulls have struggled to keep BTC/USD above the $29,000 support since April 10. However, it still fell on Thursday, April 20, pulling other cryptocurrencies with it and causing a wave of closing long positions. There was no obvious reason for this drawdown, beautifully named Coinglass. Some analysts believe that against the backdrop of a news vacuum, technical signals have come to the fore. And perhaps some growth in the DXY Dollar Index on April 14-17 played a role. But, despite this fall, according to many experts, the prospects for bitcoin look quite optimistic, which is confirmed by both network metrics and macroeconomic factors. Investors' appetites are fueled by a good start of the flagship cryptocurrency, which showed a yield of 70% in Q1. Thanks to this, Goldman Sachs experts called it the most effective financial asset in 2023.

According to analytics agency Glassnode, despite the collapse of FTX and tightening crypto regulation, the holdings of long-term holders (addresses with coins that have been idle for more than 155 days) rose to 14.2 million BTC. This is near the all-time high and suggests that coin owners are counting on their growth in the future.

At the moment, there is no clear understanding of the future monetary policy of the US Federal Reserve. But it is the behavior of the American mega-regulator that is decisive for the dollar exchange rate, and as a result, determines in which direction the BTC/USD scales will swing. Robert Kiyosaki, author of the popular book Rich Dad Poor Dad, spoke again this week about the inevitability of financial turmoil and called on investors to invest more in bitcoin, gold and silver. The businessman promised that he would increase reserves in digital currency in the near future, as he does not trust the US Federal Reserve and the economic policies of the Joe Biden administration. According to Kiyosaki's forecast, if big capital becomes more active in physical and digital gold, their price will rise to $5,000 and $500,000 by 2025, respectively.

It should be noted here that, according to Glassnode, the correlation coefficient between XAU and BTC is growing and now exceeds 0.85. Such a connection of bitcoin with the classic safe-haven asset can provide it with serious support, since gold has already approached its all-time high and is preparing to update it.

Ark Invest looked even further into the future than Robert Kiyosaki and called the timing of bitcoin's reaching $1 million. “In the next decade, the value of bitcoin could reach $1 million as the digital economy grows,” said Yassine Elmandjra, an analyst at the company. He acknowledged that the 30x coin price growth forecast looks incredible, but it is “quite reasonable” if you look at the history of cryptocurrency development.

According to the Ark Invest analyst, statements that it is now too late to invest in BTC are wrong. The expert noted the impressive performance of bitcoin in recent times, which now makes digital gold an attractive component of investment portfolios. According to Elmandjra, a reasonable share of bitcoin in institutions should be between 2.5% and 6.5%, depending on the overall return of the portfolio and risk appetite.

Bobby Lee, the founder of the Ballet app and the former CEO of the BTCC China crypto exchange, have taken a similar position. In his opinion, against the backdrop of the banking crisis, digital currencies have demonstrated the qualities of safe-haven assets. “People have begun to realize that their money in the bank is not necessarily in place. Institutions lend these funds to other enterprises and firms. And cryptocurrencies like bitcoin provide self-storage and full control over resources". At the same time, Lee has noted signs of bitcoin's recovery after the crypto winter of 2022. “It has been like this for a long time. Cryptocurrency has four-year cycles [...] and now we have practically recovered. It looks inspiring,” said the industry veteran.

According to a report by Matrixport researchers, the price of bitcoin hit its predicted low in November 2022. The analysts explained that BTC historically bottomed out 515-458 days before the next halving. This event is scheduled for April 2024; hence the predicted low was between November 2022 and January 2023. And so it happened. This gives reason to expect that this model will continue to work further, and the value of the coin will rise to at least $63,160 by the spring of 2024.

As for the near-term prospects, the analytical agency K33 predicts the growth of BTC/USD by another 50% in the next 30 days. The analysis is based on the surprising similarity of the 2018 and 2022 cycles. So, in both cases, it took about 370 days to reach the bottom from the historical high, and recovery to 60% took another 140 days. Further extrapolation suggests that bitcoin will trade around $45,000 in the last decade of May.

The forecast of Galaxy Digital CEO Mike Novogratz looks more modest and stretched in time. In his opinion, the quotes of the first cryptocurrency will rise to $40,000 only when the US Federal Reserve begins to reduce the key rate. “The most profitable trades have been and will continue to be longs on gold, euro, bitcoin and Ethereum: these assets will do well when the Fed stops raising [the base rate] and starts lowering it,” Novogratz said. He also predicted a reduction in loans amid the collapse of US banks. In his opinion, this could lead to a credit crisis, and the Fed, against the background of a “slowdown in the economy”, will have to cut the rate more aggressively than expected.

And of course, against the background of dominant optimism, the forecast of analyst Nicholas Merten looks exactly the opposite. He announced in a new video on DataDash to his 511,000 subscribers that it's time to sell bitcoin, as the first cryptocurrency has grown by almost 100% since November 2022. Merten believes that the first cryptocurrency's latest breakthrough could be a trap, as crypto markets were overbought. The expert disagrees with those who believe that bitcoin will follow the 2019 scenario, when it rose by 300% in a few months. According to him, the scenario of June 2021 is likely to be repeated, when BTC reached its historical high and then collapsed.

At the time of writing, Friday evening, April 21, BTC/USD is trading at $27,305. The total capitalization of the crypto market is $1.153 trillion ($1.276 trillion a week ago). The Crypto Fear & Greed Index fell from 68 to 50 in seven days, and moved from the Greed zone to the very center of 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.

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CryptoNews of the Week


- Bobby Lee, founder of the Ballet app and former CEO of the BTCC China crypto exchange, noted signs of bitcoin recovery after the 2022 crypto winter in an interview with Bloomberg TV. “It has been like this for a long time. Cryptocurrency has these four-year cycles [...] and now we're almost back on track. It looks inspiring,” said the industry veteran.
According to Lee, amid the banking crisis, digital currencies have demonstrated the qualities of safe-haven assets. “People have begun to realize that their money in the bank is not necessarily in place. Institutions lend these funds to other enterprises and firms. And cryptocurrencies like bitcoin provide self-storage and full control over resources,” he said.
Lee also commented on the regulatory framework for US financial markets, calling it “the most mature and established regulatory regime.” According to the head of Ballet, supervisory agencies like the SEC, after a decade of calls for tougher policies regarding the crypto industry, have changed it to a more favorable one. Lee was also enthusiastic about the adoption of digital asset regulations in Hong Kong. In his opinion, the decisions of the authorities of both jurisdictions demonstrate a global shift towards the recognition of cryptocurrencies.

- Anthony Scaramucci, former White House Communications Director and founder of SkyBridge Capital, said he has not lost his enthusiasm for bitcoin. The investor added that he is more optimistic about the first cryptocurrency than ever.
Unlike Bobby Lee, he criticized the head of the SEC, Gary Gensler, for the "mess" in the department. Scaramucci believes that the first cryptocurrency should be classified as a commodity and not subject to regulation by the US Securities and Exchange Commission.

- Galaxy Digital CEO Mike Novogratz named the condition for bitcoin to reach $40,000. In his opinion, the quotes of the first cryptocurrency will rise to this level when the US Federal Reserve starts to reduce the key rate. “The most profitable trades have been and will continue to be longs on gold, euro, bitcoin and Ethereum: these assets will do well when the Fed stops raising [the base rate] and starts lowering it,” Novogratz said. He also predicted a reduction in loans amid the collapse of US banks. In his opinion, this could lead to a credit crisis, and the Fed, against the background of a “slowdown in the economy”, will have to cut the rate more aggressively than expected.
Galaxy Digital CEO called the CFTC (Commodity Futures Trading Commission) lawsuit against the Binance bitcoin exchange, filed at the end of March, and its accusation of intentionally violating the rules established by the agency as the main uncertainty for the cryptocurrency market.

- Ark Invest has looked beyond Mike Novogratz and has announced the timeline for bitcoin to reach $1 million. “In the next decade, the value of bitcoin could reach $1 million as the digital economy grows,” said Yassine Elmandjra, an analyst at the company. He acknowledged that the 30x coin price growth forecast looks incredible, but it is “quite reasonable” if you look at the history of cryptocurrency development.
According to the Ark Invest analyst, statements that it is now too late to invest in BTC are wrong. The expert noted the impressive performance of bitcoin in recent times, which now makes digital gold an attractive component of investment portfolios. According to Elmandjra, a reasonable share of bitcoin in institutions should be between 2.5% and 6.5%, depending on the overall return of the portfolio and risk appetite.

- Robert Kiyosaki, author of the popular book Rich Dad Poor Dad, spoke again this week about the inevitability of financial turmoil and called on investors to invest more in bitcoin, gold and silver. The businessman promised that he would increase reserves in digital currency in the near future, as he does not trust the US Federal Reserve and the economic policies of the Joe Biden administration. “Why buy more gold, silver and bitcoin? Because the Fed, Treasury and Biden are liars!” Kioysaki said. According to his forecast, if large capital becomes more active in physical and digital gold, their price will rise to $5,000 and $500,000 by 2025, respectively.

- According to a report by Matrixport researchers, the price of bitcoin hit its predicted low in November 2022. The analysts explained that BTC historically bottomed out 515-458 days before the next halving. This event is scheduled for April 2024; hence the predicted low was between November 2022 and January 2023. That's what happened. This gives reason to expect that this model will continue to work further, and the value of the coin will rise to at least $63,160 by the spring of 2024.
In addition, the experts noted an interesting point. Their observations showed that American investors are more willing to invest in bitcoin, while their Asian counterparts prefer ethereum.

- Analyst Nicholas Merten is of an opposite opinion. He announced in a new video on DataDash to his 511,000 subscribers that it's time to sell bitcoin, as the first cryptocurrency has grown by almost 100% since November 2022. Merten believes that the first cryptocurrency's latest breakthrough could be a trap, as crypto markets were overbought.
The expert disagrees with those who believe that bitcoin will follow the 2019 scenario, when it rose by 300% in a few months. According to him, the scenario of June 2021 is likely to be repeated, when BTC reached its historical high and then collapsed.

- The creators of the famous chatbot ChatGPT have banned it from directly providing cryptocurrency forecasts.  It turned out that it is very often wrong, and it is still unknown which algorithms it uses for its predictions. In addition, AI is not able to correctly interpret a lot of important data. These include, in particular, new posts on social networks by well-known analysts. Namely, many traders and investors rely on them when making decisions. Also, ChatGPT is unable to predict the occurrence of certain significant events on the crypto market, which reduces the accuracy of its forecasts significantly.
Based on the foregoing, it becomes obvious that the chatbot can only be used as an auxiliary tool, nothing more. It is extremely risky to create trading strategies and make trading decisions based on it. However, despite this, some users use various tricks to get around the ban, in the hope that a miracle will happen and ChatGPT will open their way to wealth.

- Owners of Android devices are at risk of becoming victims of a new virus that pretends to be the CoinSpot crypto exchange. This is reported by Cyble researchers who identified the Trojan. The list of the virus's functionality includes the ability to steal user credentials, cookies, and SMS messages.
Fraudsters also steal credit card information under the guise of subscribing to a chatbot. It was reported earlier that attackers began to distribute viruses under the guise of desktop versions of the ChatGPT chat bot from OpenAI. Thus, the Android and Windows operating systems were at risk.


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Finance Derivative magazine announced the Awards 2023. Among the awardees is the NordFX brokerage company, which won in two categories at once: "Most Transparent Forex Brokerage Company UAE 2023" and "Best Forex Affiliate Program South East Asia 2023".

Finance Derivative is a print and online publication that publishes news and insights about the financial industry. It was founded in 2017 and provides its readers with information on financial technology, investment, banking, and other topics related to the financial sector. Finance Derivative's readership includes financial industry professionals, among them bankers, traders, analysts, consultants, investors, and managers.

In addition to publications, Finance Derivative hosts the annual Awards to celebrate outstanding achievements in the financial industry. The award includes several categories, such as "Best Bank", "Best Investment Fund", "Best Financial Startup", "Best Broker" and others. The award is given by a team of journalists and experts from the financial industry who conduct in-depth analysis and evaluation of candidates and decide who deserves the award. Past winners include such world-famous organizations as Barclays Bank and JPMorgan Chase, BlackRock investment fund, Visa and Revolut payment systems.

In 2023, the brokerage company NordFX is among the winners. «Finance Derivative would like to congratulate you and offers special recognition and appreciation for your outstanding performance and dedication to excellence. Honoring your outstanding performance, we are delighted to announce that Nord FX is the Winner 2023 for the Category "Most Transparent Forex Brokerage Company UAE 2023" and "Best Forex Affiliate Program South East Asia 2023".
 

Notice: These materials should not be deemed a recommendation for investment or guidance for working on financial markets: they are for informative purposes only. Trading on financial markets is risky and can lead to a loss of money deposited.

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EUR/USD: The Dollar Continues to Sink


The DXY dollar index updated a 12-month low last week, and EUR/USD, respectively, rose to a maximum (1.1075) since April 04, 2022. The US currency has been falling for the fifth week in a row: the longest series since summer 2020.

The dollar received a serious blow on Wednesday, April 12, when data on consumer inflation (CPI) and the minutes of the March US Federal Reserve FOMC (Federal Open Market Committee) meeting were published. Statistics showed that prices are under control and inflation in the US has been consistently slowing down for nine consecutive months, going from 9.1% y/y to the current 5.0% y/y. The US Producer Price Index (PPI), released a day later, also showed a decrease in inflation, although at the basic level, US price pressure still looks stable.

With regard to the Fed Protocol, at the meeting on March 22, FOMC members discussed the possibility of taking a pause in the rate hike cycle due to problems in the banking sector. Information about a possible mild recession in the US economy later this year was also discussed. However, the rate is likely to be raised again at the next meeting of the Committee on May 3. According to CME FedWatch forecasts, it is likely to grow by another 25 basis points (bp) to 5.25% per annum.

This increase has already been taken into account by the market in quotes and is unlikely to provide any support to the dollar. Moreover, 5.25% is likely to be the peak value of the rate, until the last months of the year, when it starts to decline. The futures market expects that federal funds spending will be 4.30-4.40% in December 2023, and they will fall even lower to 4.12-4.20% in January 2024.

Slower inflation and the end of the Fed's tight monetary policy cycle are putting pressure on the dollar, pushing the DXY down. At the same time, forecasts suggest that, unlike the Fed, the European Central Bank will continue its tightening cycle for now. This was confirmed by the Member of the Board of Governors of the ECB, President of the Bundesbank Joachim Nagel. He said on Thursday, April 13 that it is necessary to continue raising rates, as core inflation in the Eurozone is still very high.

Data on retail sales in the US released at the very end of the working week, on Friday, April 14 slightly supported the US currency. They showed that sales, although falling, were much slower than expected. With the forecast of -0.4% and the previous value of -0.2%, in reality, the decline was -0.1%. Market participants regarded such dynamics in favor of the dollar, and as a result, EUR/USD ended the last week at 1.0993. At the time of writing the review, on Friday evening, April 14, analysts' opinions are almost equally divided: 45% of them expect the dollar to further weaken, 45% expect it to strengthen, and the remaining 10% have taken a neutral position. As for technical analysis, all oscillators and trend indicators on D1 are 100% colored green. The nearest support for the pair is at 1.0975, then 1.0925, 1.0865-1.0885, 1.0740-1.0760, 1.0675-1.0710, 1.0620 and 1.0490-1.0530. Bulls will meet resistance at 1.1050-1.1070, then 1.1110, 1.1230, 1.1280 and 1.1355-1.1390.

We expect quite a lot of economic statistics from the EU next week. Thus, the ZEW Economic Sentiment Index in Germany, the main locomotive of the European economy, will be published on Tuesday, April 18. On Wednesday, we will find out what is happening with inflation (CPI) in the Eurozone as a whole. On Thursday, the Minutes of the last meeting of the ECB on monetary policy will be published, and on Friday, April 21, business activity indicators (PMI) in the manufacturing sector of Germany and in the country as a whole will become known. No significant macro statistics are expected from the US next week.

GBP/USD: Things Are Much Better Than Expected

Against the backdrop of the dollar weakening, GBP/USD still feels good, and it made another high in the first half of Friday, April 14, reaching the height of 1.2545. The pound has not traded this high since the beginning of June 2022. However, then, after the publication of data on retail sales in the US, the dollar improved its position, and the pair completed the five-day period at the level of 1.2414.

As for the UK economy itself, the GDP release on Thursday 13 April showed that the economy stagnated at 0.0% in February, compared with the forecast of 0.1% and the previous reading of 0.3%. The growth of production in the manufacturing industry in February was also 0.0% against the expected 0.2% and -0.1% in January, while the total industrial output is still in the negative zone -0.2% against the forecast of 0.2% and -0.5% a month earlier. On an annualized basis, manufacturing output came in at -2.4%, beating expectations of -4.7%. The total volume of industrial production decreased by -3.1% against the forecast -3.7% and the previous value -3.2%. Data on the trade balance of goods in the UK was also published last week, which in February amounted to £17.534 billion, which is more than the forecast of £17.000 billion and the previous value of £16.093 billion.

What do all these numbers say? Together with the data on business activity (PMI), which became known on April 03 and remained above 50 points, all these statistics give investors hope that the British economy is able to avoid a recession. Which, in turn, supports the position of the national currency. This was confirmed on April 13 by British Treasury Secretary Jeremy Hunt, who said that the economic outlook looks brighter than expected. “Thanks to the steps we have taken, we will avoid a recession,” he assured the audience.

The Bank of England (BoE) Chief Economist Hugh Pill's comments were quite optimistic as well. According to him, although "the exact path of inflation may be more uneven than we expect," the Central Bank still forecasts a decrease in CPI in Q2 of this year. "The latest figures are somewhat disappointing," said Hugh Pill, "but they are much better than the BoE's forecasts made at the end of last year." The economist also noted that the UK banking system remains very sound and resilient, and inflationary dynamics is a key factor determining the direction of BoE's monetary policy.

At the moment, 75% of experts side with the pound and expect further growth of the pair, the remaining 25% side with the dollar. Among the oscillators on D1, the balance of power is as follows: 65% vote in favor of green (10% give overbought signals), 10% have turned red and 25% prefer neutral gray. Among the trend indicators, the advantage is also on the side of the greens, they have 65%, the enemy has 35%. Support levels and zones for the pair are 1.2390-1.2400, 1.2330, 1.2275, 1.2200, 1.2145, 1.2075-1.2085, 1.2000-1.2025, 1.1960, 1.1900-1.1920, 1.1800-1.1840. When the pair moves north, it will face resistance at levels 1.2440-1.2455, 1.2480, 1.2510-1.2540, 1.2575-1.2610, 1.2700, 1.2820 and 1.2940.

Among the events of the coming week, the calendar can and should note the publication of the latest unemployment data in the United Kingdom on Tuesday, April 18. On Wednesday, the value of the Consumer Price Index (CPI) will become known, and on Friday the statistics on retail sales and business activity (PMI) in the UK will be published.

USD/JPY: Bank of Japan Is an Island of Stability

Since last December, USD/JPY has been moving in a fairly wide sideways range of 129.00-138.00. (An exception is the brief strengthening of the yen to 127.15 in mid-January). The pair ended the last week almost in its very center, at the level of 133.75, which indicates the absence of significant drivers capable of giving the pair a powerful acceleration in one direction or another.

We have repeatedly written that even after Haruhiko Kuroda, Governor of the Bank of Japan (BoJ), leaves his post, the Central Bank “will continue to support his adequate and expedient policy.” This was once again confirmed by Kazuo Ueda, the new head of the regulator, who took office on April 9. He stated at the G20 meeting that he would support the current ultra-soft monetary policy. In addition, Ueda said that core consumer inflation in Japan, which is currently only about 3%, is likely to fall below 2% in the second half of this fiscal year. Market participants concluded from these words that there is no point in fighting it by raising rates for the Bank of Japan, and therefore it is not worth expecting a reversal of the BoJ rate in the foreseeable future. (Recall that economists at Societe Generale and ANZ Bank expected that this could still happen somewhere around June).

Regarding the immediate prospects for USD/JPY, analysts' opinions are distributed as follows. At the moment, 40% of experts vote for the further movement of the pair to the north, 50% point in the opposite direction and 10% prefer neutrality. Among oscillators, 75% point upwards at D1 (a third of them are in the overbought zone), 10% look in the opposite direction and 15% are neutral. For trend indicators, 85% point to the north, the remaining 15% point to the south. The nearest support level is located in the zone 132.80-133.00, then there are levels and zones 132.00-132.40, 131.25, 130.50-130.60, 129.65, 128.00-128.15 and 127.20. Levels and resistance zones are 134.00, 134.90-135.10, 135.90-136.00, 137.00, 137.50 and 137.90-138.00.

As for the release of any important statistics on the state of the Japanese economy, it is not expected this week.

CRYPTOCURRENCIES: Weak Dollar Is Strong Bitcoin

Bitcoin rose above $30,000 on Tuesday, April 11, for the first time since June 2022. This happened due to instability in the banking sector and expectations that mega-regulators, primarily the Fed, will suspend raising interest rates. The MSCI World Index rose to its highest point since early February by Friday, April 14. This confirmed the fact that international investors are waiting for the American, and in the future, for other major Central Banks to curtail the policy of quantitative tightening (QT). Against this background, the main cryptocurrency continues to outperform other major asset classes, such as gold or oil. In addition, BTC has surpassed many top cryptocurrencies in terms of dynamics.

In the middle of the week, the bears had a chance to return BTC/USD to the support of $29,000. However, the FRS saved it from falling again: the published Minutes of the March FOMC meeting, coupled with macro statistics from the US, weakened the dollar, swinging the scales in favor of bitcoin.

The growth of BTC quotes pulls up the entire crypto market. The total market capitalization of cryptocurrencies has grown by more than 55% since the beginning of 2023, rising above $1.2 trillion. However, despite this, it still remains well below the all-time high of $2.9 trillion recorded in November 2021.

Several experts at once expressed their opinion on what happened on April 11. Michael Van De Poppe, a well-known strategist and founder of the investment company Eight, noted that bitcoin successfully passed the $28,600 test, which led to a breakthrough in resistance and reached $30,000. An analyst with the nickname PlanB tweeted that all the goals he set back in October 2022 have now been achieved. At that time, the expert predicted that BTC quotes would overcome $21,000, $24,000, and then $30,000. And another popular blogger and analyst, Lark Davis, stressed that the time will soon come when buying bitcoins for less than $30,000 will seem as fantastic as buying BTC at $3,000 now.

As of this writing, Friday evening April 14, BTC/USD is trading at $30,440. The total capitalization of the crypto market is $1.276 trillion ($1.177 trillion a week ago). The Crypto Fear & Greed Index rose from 64 to 68 in seven days and is still in the Greed zone. But what's next?

A well-known analyst under the nickname PlanB noted that bitcoin has left the deep bear zone and is at the very beginning of a new bull market. According to PlanB, the Stock to Flow (S2F) model he developed is still relevant. The expert claims that bitcoin fundamentals will eventually allow it to rise above the all-time high (ATH) of $69,000 set in November 2021. PlanB has previously predicted bitcoin will rise from $100,000 to $1 million after the 2024 halving. (Recall that the S2F (stock-to-flow ratio) model for predicting the BTC rate measures the relationship between the available supply of an asset and its production volume and has been repeatedly criticized by members of the crypto community).

Larry Lepard, managing partner at Boston-based equity firm Equity Management Associates, also looks extremely optimistic in the long-term outlook. According to him, the dollar will depreciate over the next 10 years, and citizens will begin to actively invest in cryptocurrencies, gold and real estate. The supply of bitcoins is limited, so the digital asset will become a highly sought-after investment vehicle and will benefit from the collapse of the fiat currency. “I believe that the price of bitcoin will go up a lot. I think it will first reach $100,000, then $1 million and eventually rise to $10 million per coin. I’m sure my grandchildren will be shocked at how rich people who own just one bitcoin become,” Lepard said in an interview.

In connection with this forecast, the businessman fears that the authorities will put spokes in the wheels of the crypto industry, trying to slow down the growth in the popularity of digital assets. For example, officials could raise taxes on profits from bitcoin trading and tighten regulation of coins to make it harder for startups to enter the market. However, Lepard is confident that bitcoin will be able to overcome these difficulties and succeed in the long run.

Many analysts agree that long-term macro conditions do point to a possible rise in BTC. But their estimates are much more restrained in relation to the current rally. This is due to the fact that bitcoin liquidity is now much lower than in the same period last year. This is manifested in a greater price dispersion among the leading exchanges. (In the previous review, we wrote that on the one hand, there is an increase in trading volumes, and on the other hand, a decrease in BTC liquidity to a 10-month low).

Although, of course, the prospects for this year will largely depend on the actions of the leading Central banks led by the Fed. Recall that the record capitalization of the crypto market in November 2021 was also the result of the actions of this regulator, which then flooded the economy with a huge amount of cheap money (the M2 monetary unit grew by 39%, which is an anomaly by historical standards). Moreover, interest rates were near zero levels at the time, which led to the emergence of a bubble in the market for risky assets, including stocks and digital currencies. The Fed then moved from quantitative easing (QE) to quantitative tightening (QT) through the fastest interest-rate hike cycle in 40 years, and... the bubble burst.

Speaking about the prospects of the flagship cryptocurrency, it is impossible not to mention those who still consider it a bubble and predict its final collapse. Dieter Wermuth, an economist and partner at Wermuth Asset Management, said last week that the economy would be better and simpler without bitcoin. In his opinion, these risky investments are associated with social costs, and the cryptocurrency itself does not contribute to global prosperity. If we consider bitcoin as a currency, then, given the high volatility and lack of real use, BTC is doomed to failure. In this vein, it makes sense to ditch bitcoin altogether: it could be good for shared prosperity, as investing in cryptocurrencies is wasteful and takes away funds from overall economic growth. In addition, bitcoin creates social inequality, allows for money laundering, tax evasion, and is very energy intensive due to mining. Dieter Wermuth even called bitcoin “the biggest climate killer.”

Cryptocurrency opponents received unexpected support from … artificial intelligence. ChatGPT Bot spoke about the formation of a recession-resistant investment portfolio. According to a document published by the Gold IRA Guide, it recommended allocating 20% for gold and other precious metals. The rest of its hypothetical portfolio consisted of bonds (40%), "defensive" stocks (30%) and cash (10%). The chatbot did not mention cryptocurrencies, much to the delight of well-known bitcoin critic and gold advocate Peter Schiff. “After all, artificial intelligence is pretty smart. It did not recommend any bitcoin deposit,” this investor wrote.

By the way, answering the question of which cryptocurrency is the most promising today, ChatGPT did not name bitcoin, but ethereum. Artificial intelligence, of course, did not know about the latest events, but it seems to have hit the mark. In the last review, we detailed the Shapella hard fork, which will allow validators to withdraw the frozen ETH coins they have invested and locked on the network over the past 3 years in exchange for interest. Investors and traders were worried that an unlock could lead to a massive selling wave and, as a result, a sharp drop in the price. However, we are still seeing the opposite process: on May 13, ETH/USD rose above $2,000, and on the evening of Friday, April 14, it is trading in the $2,100 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.

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CryptoNews of the Week


- On April 11, bitcoin rose above $30,000, for the first time since June 2022. The main cryptocurrency continues to outperform other major asset classes such as gold or oil. This comes amid expectations that central banks will put a hold on rate hikes.
Several industry analysts have expressed their opinion on what happened. Michael Van De Poppe, a well-known strategist, and founder of the investment company Eight, noted that bitcoin successfully passed the $28,600 test, which led to a breakthrough in resistance and reached $30,000. An analyst with the nickname PlanB tweeted that all the goals he set back in October 2022 have now been achieved. At that time, the expert predicted that BTC quotes would overcome $21,000, $24,000, and then $30,000. And another popular blogger and analyst, Lark Davis, stressed that the time will soon come when buying bitcoins for less than $30,000 will seem as fantastic as buying BTC at $3,000 now.

- In terms of the number of requests, bitcoin has overtaken former President Donald Trump, famous musician Elvis Presley, and Disney World. In the United States, the number of requests related to the first cryptocurrency in the Google search engine reached 1.9 million, and in terms of the global indicator, the figure reached 12 million. This is stated in research by Ahrefs. According to Google Trends, Donald Trump was only two days ahead of bitcoin last month when reports of his arrest surfaced.

- In India, a 23-year-old employee of a large technology company tried to commit suicide after losing 3 million rupees (about $ 37,000) on investments in cryptocurrency. This is reported by The Times of India. According to the publication, a taxi driver noticed the young man on a bridge in Kolkata and reported to the police. As a result, law enforcement officers prevented him from jumping into the river. During the interrogation, the investor spoke about unsuccessful investments in the digital asset market. For this purpose, he used, among other things, his mother's pension and borrowed funds. Recently, he has been receiving threats demanding a refund.
Earlier, The Balance rehabilitation center in Spain began providing treatment services for addiction to digital asset trading. The course is four weeks long. The cost of treatment exceeds $75,000 (that is, twice what the failed investor from India lost).

- The head of the opposition party “For Thailand” (Pheu Thai) and candidate for Prime Minister Srettha Thavisin has promised to allocate digital assets to every citizen over 16 years of age if he wins the elections in May. According to Bloomberg, each eligible resident will allegedly be able to receive 10,000 baht (~$290). It is not specified which cryptocurrency the “state-owned AirDrop” is planned to be used in. The office of the incumbent Prime Minister is already concerned about the proposed action and is wondering where the funds (about $15 billion) for this AirDrop will come from.
It should be noted that such an initiative is not new. The El Salvadorian government has already given away bitcoins to its citizens who used Chivo wallets. True, the amount was 10 times more modest, about $30.

- ChatGPT artificial intelligence spoke about the formation of a recession-resistant investment portfolio. According to a document published by the Gold IRA Guide, the chatbot recommended allocating 20% for gold and other precious metals. The rest of its hypothetical portfolio consisted of bonds (40%), "defensive" stocks (30%) and cash (10%).
The chatbot did not mention cryptocurrencies, much to the delight of well-known bitcoin critic and gold advocate Peter Schiff. “After all, artificial intelligence is pretty smart. It did not recommend any bitcoin deposit,” this investor wrote.
However, ChatGPT's response was not necessarily against digital gold in favor of physical gold. The ForkLog editors asked the chatbot for its opinion on both assets. According to the answer, the choice between them may depend on investment goals, risk level and personal preferences.

- This week, investors will have access to the second most popular cryptocurrency, ethereum, worth more than $33 billion (about 15% of the total). This will happen as part of the planned blockchain modernization, writes Reuters. A new blockchain software update called Shapella will allow investors to redeem their ETH coins they have invested and locked on the network over the past 3 years in exchange for interest.
Traders are now trying to figure out how this sudden flood of cryptocurrency can affect its price. Some market participants are concerned that the unlock could lead to a massive wave of sales, which in turn would drive the price down dramatically. However, the only thing that can be said for sure is that the hard fork will cause an increase in price volatility.

- Dieter Wermuth, an economist, and partner at Wermuth Asset Management, believes that the economy would be better and simpler without bitcoin. In his opinion, these risky investments are associated with social costs, and the cryptocurrency itself does not contribute to global prosperity.
The BTC market is highly centralized and primarily benefits the very first investors and miners. If we consider it as a currency, given the high volatility and lack of real use, BTC is doomed to failure, the specialist believes. In this vein, it makes sense to ditch bitcoin altogether: it could be good for shared prosperity, as investing in cryptocurrencies is wasteful and takes away funds from overall economic growth. In addition, bitcoin creates social inequality, allows for money laundering, tax evasion, and is very energy intensive due to mining. Dieter Wermuth even called bitcoin “the biggest climate killer.”

- It turns out that Apple has been hiding the official description of BTC in every computer since 2018. Technician Andy Baio revealed on Twitter that he accidentally found a copy of Satoshi Nakamoto's official description of BTC on his Apple Mac computer, Business Insider writes. Baio explained it this way: “Today, while trying to fix my printer, I discovered that a PDF copy of Satoshi Nakamoto’s bitcoin datasheet came with every copy of macOS since Mojave in 2018.” According to him, many of his fellow Mac users confirmed this fact: each of them had a file called "simpledoc.pdf".
Baio suggested the reason why, of all the documents, it was the original description of BTC that was chosen to be included in Apple's operating system: "Maybe it was just a convenient, lightweight, multi-page PDF file for testing purposes that was never meant to be viewed by end users."

- The US Department of Defense commissioned a study on the potential collapse of the economy due to the cryptocurrency market. Inca Digital, an analytical blockchain firm, won the competition for this work. A representative of this company noted in comments to the media that the banking system has increasingly intersected with the crypto market recently, and this connection makes this market a subject of national security: “Cryptocurrencies are no longer an independent vertical. They rely on banks, the internet, and that's what people should be warned about: it's a single combined system that is widespread in everyday services." Defense Department officials, in turn, expect the development to shed light on whether hostile groups or nations can use digital currencies against the US.

- U.S. potential presidential candidate Robert Kennedy Jr called bitcoin a safe haven that, thanks to decentralization, is less exposed to the risks inherent in traditional finance. The politician is confident that the current “financial bubble” will inevitably burst, and cryptocurrencies “will allow people to hide from its splashes” and open up a “way of salvation” for society.

– Lawrence Lepard, managing partner at Boston-based equity firm Equity Management Associates, believes that bitcoin will rise to $10 million due to the collapse of the US dollar. According to Lepard, the dollar will depreciate over the next 10 years, and citizens will begin to actively invest in cryptocurrencies, gold and real estate. The supply of bitcoins is limited, so the digital asset will become a highly sought-after investment vehicle and will benefit from the collapse of the fiat currency. “I believe that the price of bitcoin will go up a lot. I think it will first reach $100,000, then $1 million and eventually rise to $10 million per coin. I’m sure my grandchildren will be shocked at how rich people who own just one bitcoin become,” Lepard said in an interview.
In connection with this forecast, the businessman fears that the authorities will put spokes in the wheels of the crypto industry, trying to slow down the growth in the popularity of digital assets. For example, officials could raise taxes on profits from bitcoin trading and tighten regulation of coins to make it harder for startups to enter the market. However, Lepard is confident that bitcoin will be able to overcome these difficulties and succeed in the long run.

- A well-known analyst under the nickname PlanB noted that bitcoin has left the deep bear zone and is at the very beginning of a new bull market. According to PlanB, the Stock to Flow (S2F) model he developed is still relevant. The expert claims that bitcoin fundamentals will eventually allow it to rise above the all-time high (ATH) of $69,000 set in November 2021. PlanB has previously predicted bitcoin will rise from $100,000 to $1 million after the 2024 halving.
Recall that the S2F (stock-to-flow ratio) model for predicting the BTC rate measures the relationship between the available stock of an asset and its production volume and has been repeatedly criticized by members of the crypto community.


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.

#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #forex #cryptocurrencies #bitcoin #stock_market

https://nordfx.com/

EUR/USD: Fed rate Divination Continues


The dollar seems to be either weakening or not. On the one hand, the DXY dollar index updated a two-month low on April 4, falling below the support of 101.50, and EUR/USD rose to a new high of 1.0972. On the other hand, the pair returned by the end of last week to where it had already been on March 23 and 31.

DXY continues to be pressured by poor US macro statistics. The country's GDP growth for Q4 2022 was 2.6%, which is lower than both the forecast and the previous value (2.7%). Business activity in March continued to decline at an accelerated pace: the PMI index in the manufacturing sector fell to 46.3 against the forecast of 47.5 and 47.7 in February, and it fell to 51.2 in the services sector (forecast 54.5, February value 55.1). New orders for industrial goods fell by 0.7% in February, worse than the forecast of 0.5% once again. And this despite the fact that they had already fallen by 2.1% a month earlier. The JOLTs job market report showed a decline in the number of open vacancies to 9.9 million, the lowest figure in the last two years.

The US Bureau of Labor Statistics released its March employment report on Friday, March 07. The number of new jobs created outside the agricultural sector (NFP) in the United States, with a forecast of 240K, in reality fell to 236K. This figure was significantly higher in February and amounted to 326K. But the unemployment rate fell from 3.6% to 3.5%, which slightly supported the US currency (on the thin market, DXY rose above 102.00). However, the main reaction of the market to these data will follow only next week. April 07 in Europe, the USA and a number of other countries was a day off, Good Friday. Europe takes a break on Easter Monday, April 10 as well. The last time NFP was released on Good Friday was in 2021, and then, despite a sharp jump in this indicator, the delayed market response was very restrained.

Of course, all of the above indicators may lead to adjustments in market expectations for the US Federal Reserve rate. However, the next FOMC (Federal Open Market Committee) meeting will be held only on May 03, and many more significant statistics will be released before then. The weak state of the economy may cool the hawkish ardor of the FOMC members and force them to take a break in tightening monetary policy, leaving the rate at the same level of 5.00%. At the moment, according to the CME Group FedWatch Tool, there is a 52.7% chance of another rate hike of 25 basis points (bp).

EUR/USD closed last week at 1.0901. At the time of writing this review, on the evening of Friday, April 07, the opinions of analysts are divided almost equally: 35% of them expect further weakening of the dollar, 35% - its strengthening, and the remaining 30% have taken a neutral position. Among the oscillators on D1, 90% are colored green, another 10% are gray neutral. Among trend indicators, 75% recommend buying, 15% - selling. The nearest support for the pair is located at 1.0885, 1.0860, then 1.0740-1.0760, 1.0675-1.0710, 1.0620 and 1.0490-1.0530. Bulls will meet resistance at 1.0925, then 1.0955, 1.0985-1.1030, 1.1110, 1.1230, 1.1280 and 1.1355-1.1390.

Retail sales in the Eurozone will be announced this week on Monday April 11. The next day, important data on consumer inflation (CPI ) in the US will be released. The minutes of the March FOMC meeting will also be published on Wednesday. On Thursday, the CPI values in Germany, the number of initial jobless claims in the US and the US Producer Price Index (PPI) will be known. On Friday, we will have a whole package of statistics on retail sales in the US.

GBP/USD: PMI Gives Investors Hope

Against the backdrop of a weakened dollar, GBP/USD feels quite good, and the pound made another high on April 04, reaching a high of 1.2525. It has not traded this high since the beginning of June 2022. However, then there was a slight correction, and the pair completed the five-day period at the level of 1.2414, returning to the values of mid-December 2022 - the second half of January 2023.

As a matter of fact, the UK economy, like the US, had nothing to brag about last week. The index of business activity (PMI) in the manufacturing sector of the country, published on April 3, showed a decrease from 49.3 to 47.9 points (with a forecast of 48.0). PMI values in the services sector and the composite value of this Index also turned out to be lower than the previous values - 52.9/53.5 and 52.2/53.1, respectively. However, the fact that both of these Indexes are holding above the 50.0 mark gives investors hope that the British economy is able to avoid a recession. This, in turn, supports the position of the national currency.

At the moment, 40% of experts side with the pound, the same number (40%) have taken a wait-and-see position, only 20% have turned out to side with the dollar. Among the oscillators on D1, the balance of power is as follows: 90% vote in favor of green and 10% have turned red. Among the trend indicators, the advantage is on the side of the greens, they have 85%, the enemy has 15%. Support levels and zones for the pair are 1.2390, 1.2330, 1.2275, 1.2200, 1.2145, 1.2075-1.2085, 1.2000-1.2025, 1.1960, 1.1900-1.1920, 1.1800-1.1840. When the pair moves north, it will face resistance at levels 1.2450, 1.2510-1.2525, 1.2575-1.2610, 1.2700, 1.2750 and 1.2940.

In terms of the UK economy, there are two speeches by Bank of England (BoE) Governor Andrew Bailey next week on Wednesday April 12. On Thursday, April 13, there will be data on production volumes in the manufacturing industry, as well as on the country's GDP. As a reminder, Monday April 10 is Easter Bank Holiday in the United Kingdom.

USD/JPY: BoJ Remains Ultra Soft

This time the dynamics of USD/JPY as a whole corresponded (as it should be, mirrored) to what its "colleagues" in DXY were doing. At the beginning of the week, it fell from a height of 133.75 and recorded a local low of 130.60 on April 5. And then it went up, reaching 132.37 in a thin market and a sluggish US employment report. The last chord of the week sounded a bit lower, at 132.14.

As far as Japan's monetary policy is concerned, nothing has changed here: external influencers still hope for its tightening, domestic influencers say that the ultra-soft, dovish rate remains unchanged. Thus, on Friday, April 7, Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), gently hinted that “it is appropriate to make the Bank of Japan's monetary policy more flexible.” And Japanese Finance Minister Shunichi Suzuki on Friday praised the efforts of the outgoing Governor of the Bank of Japan (BoJ) Haruhiko Kuroda and expressed the hope that under the new leadership, the Central Bank “will continue to support its adequate and expedient policy.”

We wrote in our previous review that Societe Generale economists expect that any steps to change the BoJ rate can be taken no earlier than June. The comments of their colleagues from ANZ Bank look similar. “In the near term, [BOJ] policy change looks unlikely,” they wrote. And if changes do occur, then, according to ANZ Bank forecasts, they can be expected only after Q2 of this year.

As for the immediate prospects for USD/JPY, at the moment 55% of experts vote for the further movement of the pair to the north, and 45% point in the opposite direction. Among the oscillators on D1, 25% point south, the same number look in the opposite direction, and 50% are neutral. For trend indicators, 40% point to the north, the remaining 60% point to the south. The nearest support level is located in the zone 131.85-132.00, then there are levels and zones 131.25, 130.50-130.60, 129.70-130.00, 128.00-128.15 and 127.20.  Resistance levels and zones are 132.80-133.00, 133.60-133.75, 134.35, 135.00-135.35, 135.90-136.00, 137.00, 137.50 and 137.90-138.00.

As for the release of any important statistics on the state of the Japanese economy, it is not expected this week.

CRYPTOCURRENCIES: $29,000 Resistance Has Never Been Taken

The beginning of the previous review sounded like this: “The crisis that crippled Silvergate, Silicon Valley Bank (SVB) and Signature and hit Credit Suisse has certainly helped the crypto market by reminding what decentralized finance was created for. However, investors' fears about a new wave of the banking crisis in the US and Europe are gradually fading away, which is clearly seen on the BTC/USD chart. If during the March 10-17 rally, digital gold gained almost 45% in weight, it has been unsuccessfully trying to storm the important $29,000 resistance for the last two weeks.  […] BTC is supported by the $26,500 level.”

This was written seven days ago, but even now everything said remains relevant. The only amendment is that the fluctuation range narrowed even more last week, and the local low was fixed at $27,190. Triggers are needed to break through this range in one direction or another, they have not yet been observed.

As already mentioned, the crypto market, especially bitcoin, was supported by the banking crisis and the worsening macroeconomic environment in general. However, the industry continues to be under regulatory pressure from US government agencies, which have now been joined by their UK colleagues. As a result, on the one hand, we are seeing a decrease in BTC liquidity to a 10-month low, and on the other, an increase in trading volumes.

According to a CNBC survey of industry influencers, the market remains bullish on the future of the first cryptocurrency at this stage. According to the analytical company Glassnode, its attractiveness continues to increase. Experts from this company note that a surge in trader activity was recorded in the second half of last year, when bitcoin fell to $15,000, and a similar trend is observed in 2023. Thus, the number of unique addresses on the bitcoin network with a balance of at least one coin has reached 992,243. The number of addresses controlling from 100 to 1000 BTC is 14,004. The four largest whales hold between 100,000 and 1 million BTC, including the Binance and Bitfinex exchanges, which control 248,597 and 178,010 bitcoins, respectively. At the same time, it is possible that one of these four whales is the US government. According to Dune analysts, the total stock of the first cryptocurrency in the US authorities is 205,515 BTC: more than 1% of the coin issue (mostly these assets were obtained during confiscation from criminals).

Representatives of the Derebit platform confirm the general bullish attitude. According to them, open interest in bitcoin derivatives continues to grow steadily. Derebit stressed that most of the positions are open to buy, as investors continue to believe in the potential of the crypto market's flagship.

In parallel with the growing attractiveness of digital assets for investors, their attractiveness for criminals is also growing. Cybercriminals have stolen $255.8 million in digital currencies since the beginning of the year. At the same time, "only" $8.8 million was stolen in January, 3.5 times more - $35.5 million in February, and the figure rose to $211.5 million in March.

A crypto analyst known as Stockmoney Lizards analyzed the dynamics of the flagship crypto asset. In his opinion, the asset's monthly chart looks promising and indicates the potential for further growth. The expert's assumptions are supported by the readings of the RSI indicator. Stockmoney Lizards believes that the current market situation is very similar to the period from 2017 to 2020, when a steady upward trend began to form, and that bitcoin will soon be able to reach the key $47,000 mark.

Another well-known analyst, Michael Van De Poppe, shares this view. According to the expert, buyers are still in control of the situation. If bitcoin quotes remain above $25,000 for some time, we can count on a potential increase up to the level of $40,000.

Charles Edwards, founder of hedge fund Capriole Investments, has noted a "familiar" bullish signal on the SLRV Ribbons metric. SLRV Ribbons is a tool to measure the potential return of bitcoin. It analyzes the interaction of two moving averages. When the short-term 30-day MA crosses the long-term 150-day MA, bitcoin is in the beginning of a bullish phase. This metric is “as simple as it gets,” Edwards tweeted. “It is currently repeating classic bullish behavior with a crossover in early 2023.” The specialist added that although SLRV Ribbons is a relatively new tool, tests have proven its reliability and ability to increase the return on investments in BTC.

SLRV is not the only metric that gave the founder of Capriole Investments a sense of déjà vu this month. The Bitcoin Yardstick tool shows a retracement of bitcoin's market value relative to hashrate, but still classifies BTC as "cheap" at current prices. “Bitcoin Yardstick is drawing a very familiar signature to the 2019 lows,” Edwards commented on the indicator readings. At the beginning of that year, after exiting the “cheap” zone, BTC/USD saw only one brief drop during the crisis caused by the start of the COVID-19 pandemic in March 2020. At the moment, according to indicators, price targets for BTC are fixed at $35,000.

Moving from short-term to long-term, Arthur Hayes, the former CEO of BitMEX crypto exchange, was the biggest optimist here, citing $1 million per coin as a target for bitcoin. He was prompted to do so by the news that the People's Bank of China lowered the required reserve ratios (RRR) for all banks by 0.25%. (For reference: The required reserve ratio is the statutory share of a commercial bank's liabilities on attracted deposits. When this rate is lowered, the amount of funds that commercial banks can provide for lending or investment increases.

At the time of this writing, Friday evening, April 07, BTC/USD is clearly still very far from reaching $1 million and is currently trading at $27,860. The total capitalization of the crypto market is $1.177 trillion ($1.185 trillion a week ago). The Crypto Fear & Greed Index has risen by just one point in seven days, from 63 to 64, and is still in the Greed zone.

And finally, a few words about the main altcoin, ethereum. The long-awaited Shanghai hard fork will take place on its network on April 12, which will allow validators to withdraw coins frozen for staking. At the moment, their volume is 18 million ETH, or 15% of the total supply.

To reduce potential pressure on the price and not overload the network, those wishing to exit staking will be forced to stand in line. The maximum daily outflow is limited to 2,200 transactions or 70k coins. Most likely, this queue will be quite long. And much of this is due to U.S. regulators, which put even more pressure on ethereum than bitcoin. Here are pre-trial proceedings with the Kraken and Coinbase crypto exchanges to refuse staking, and the SEC's desire to assign ETH the status of a security. All this, of course, despite the hard fork, reduces the attractiveness of this asset for investors, and makes the prospects for ethereum very vague. Well-known trader and analyst Benjamin Cowen believes that the best time to buy ethereum will be when ETH/BTC falls into the range from 0.03 to 0.04 (currently 0.067). The analyst assures that he will wait for these figures, and only then will he make an appropriate investment decision.
 

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.

#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #cryptocurrencies #bitcoin #stock_market

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CryptoNews of the Week


- UK-based crypto companies are having difficulty accessing banking services. According to Bloomberg sources, banks have begun to reject applications, block accounts and request more information regarding customer transactions.
The agency recalled the decision of HSBC and the Nationwide Building Society to prohibit retail customers from purchasing digital assets using credit cards. Payment service provider Paysafe has announced the termination of its partnership with Binance, citing a “difficult” regulatory environment.
In response to the deteriorating situation, CryptoUK representatives have approached the government with a proposal to create a "whitelist" of companies registered in the country to ease restrictions. And according to Coinpass co-founder and CEO Jeff Hancock, problems with access to banking are contrary to Prime Minister Rishi Sunak's plans to turn the country into a cryptohub.

- Cryptocurrency companies may change their jurisdiction from the US to Hong Kong amid increased supervision by US regulators. This was stated to The Wall Street Journal by Ambre Soubiran, the head of the Paris-based crypto asset data provider Kaiko. “Today, the US is tougher on cryptocurrencies than ever, and Hong Kong's regulation [looks] more favorable, which is clearly shifting the center of gravity in investing and trading crypto assets towards it. We want to be where our customers are,” she said. According to Subiran, Kaiko plans to organize a team in Hong Kong, including through access to Chinese institutional investors.

- A cryptocurrency analyst known as Stockmoney Lizards analyzed the dynamics of the flagship crypto asset. In his opinion, the asset's monthly chart looks promising and indicates the potential for further growth. The expert's assumptions are supported by the readings of the RSI indicator. Stockmoney Lizards believes that the current market situation is very similar to the period from 2017 to 2020, when a steady upward trend began to form, and that bitcoin will soon be able to reach the key $47,000 mark.
Another well-known analyst, Michael Van De Poppe, shares this view. According to the expert, buyers are still in control of the situation. If bitcoin quotes remain above $25,000 for some time, we can count on a potential increase up to the level of $40,000.
In turn, representatives of the Derebit platform informed that open interest in bitcoin derivatives continues to grow steadily. They stressed that most of the positions are open to buy, as investors continue to believe in the potential of the crypto market's flagship.

- Experts from the analytical company Glassnode spoke about the friendliest countries in terms of cryptocurrency taxation in 2023. The United Arab Emirates (UAE) turned out to be the leader. This came as no surprise, as Dubai has made a lot of efforts over the past year to attract crypto companies and other industry participants. In a short period of time, special commissions to regulate cryptocurrencies, separate tax legislation for the digital asset sector, and many other innovations have been created there. All this allows Dubai to claim the title of the world's crypto capital.
The honorable second and third places in the Glassnode list were taken by such states as Malta and Belarus. Next came Monaco, Panama and Malaysia. Among the major countries of the European Union, Germany ranked 7th. Singapore, Switzerland and El Salvador followed closely behind.

- Charles Edwards, founder of digital asset hedge fund Capriole Investments, noted a “familiar” bullish signal on the SLRV Ribbons metric in his tweet. SLRV Ribbons is a tool to measure the potential return of bitcoin. It analyzes the interaction of two moving averages. When the short-term 30-day MA crosses the long-term 150-day MA, bitcoin is in the beginning of a bullish phase. This metric is “as simple as it gets,” Edwards wrote. “It is currently repeating classic bullish behavior with a crossover in early 2023.” The specialist added that SLRV Ribbons, although a relatively new tool, has been tested and shown to be reliable and able to increase the return on investments in BTC.
SLRV is not the only metric that gave the founder of Capriole Investments a sense of déjà vu this month. The Bitcoin Yardstick tool shows a retracement of bitcoin's market value relative to hashrate, but still classifies BTC as "cheap" at current prices. “Bitcoin Yardstick is drawing a very familiar signature to the 2019 lows,” Edwards commented on the indicator readings. At the beginning of that year, after exiting the “cheap” zone, BTC/USD saw only one brief drop during the crisis caused by the start of the COVID-19 pandemic in March 2020. At the moment, according to indicators, price targets for BTC are fixed at $35,000.

- The head of largest crypto exchange Binance, Changpeng Zhao (CZ), believes that competitors to the trading platform pay news agencies and opinion leaders to increase fear, uncertainty and doubt (FUD) about his company. Zhao shared this sentiment as reports surfaced online that he had received an Interpol Red Notice (International Arrest Request). According to the head of Binance, the rumors are not true and are the next wave of FUD.
“All this looks like news leak paid for by another crypto exchange. Amazing. Thus, they [the organizers of the attacks] harm the industry and themselves. We have enough of those who attack us from the outside. At such moments, the cryptocurrency industry should [on the contrary] unite [rather than attack other market players],” Changpeng Zhao wrote in his blog. He did not specify which crypto exchange Zhao believes is attacking Binance.

- According to the analytical company Glassnode, despite the fall in the value of the leading digital currency, its attractiveness as an asset class continues to grow. Thus, the number of unique addresses on the bitcoin network with a balance of at least one coin has reached 992,243. The number of addresses controlling from 100 to 1000 BTC is 14,004. The four largest whales hold between 100,000 and 1 million BTC, including the Binance and Bitfinex exchanges, which control 248,597 and 178,010 bitcoins, respectively. At the same time, it is possible that one of these four whales is the US government. According to the Dune analysts, the total stock of the first cryptocurrency by the US authorities is 205,515 BTC: more than 1% of the coin supply. Most of these assets were obtained when they were confiscated from criminals.
Glassnode experts note that a surge in trader activity was recorded in the second half of last year, when bitcoin fell to $15,000. It was at this time that the number of BTC wallets with a non-zero balance increased sharply, a similar trend is observed in 2023.

- Cybercriminals have stolen $255.8 million in digital currencies since the beginning of the year. "Only" $8.8 million was stolen in January, 3.5 times more - $35.5 million in February, and the figure rose to $211.5 million in March. In total, hackers committed 26 hacks during the first month of spring. The largest amount was stolen during the attack on the Euler Finance DeFi platform, about $197 million, but later the hacker apologized and returned $182.7 million to the project. The reasons for this "nobility" remain unknown. He may have decided that the remaining $14 million would be enough for him.
In addition to cryptocurrencies, $31.5 million worth of NFTs were stolen in three months. A significant part of the stolen tokens was sold on the Blur and OpenSea marketplaces within the first two hours after the theft.

- Arthur Hayes, former CEO of BitMEX crypto exchange, has made a bold prediction about the rise in the price of bitcoin to $1 million. He was prompted to do so by the news that the People's Bank of China lowered the required reserve ratios (RRR) for all banks by 0.25%.
For reference: The required reserve ratio is the statutory share of a commercial bank's liabilities on attracted deposits. When this rate is lowered, the amount of funds that commercial banks can provide for lending or investment increases.


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.

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EUR/USD: Why the Dollar Fell

Last week passed without sharp jumps. The dollar continued to fall in price, and EUR/USD returned by March 30 to where it was traded seven days before. The local maximum was fixed at 1.0925, and the five-day period finished at 1.0842.

The dollar continues to be pressured by the growth of investors' risk appetite: American and European stock indices have been going up since mid-March. Asian markets are not lagging behind: they were supported by statistics on business activity (PMI) in the manufacturing industry in China.

As for US macro statistics, it did not look good. The country's GDP growth for Q4 2022 was 2.6%, which is lower than both the forecast and the previous value (2.7%). But the number of initial applications for unemployment benefits, on the contrary, increased from 191K to 198K against the forecast of 196K. Both of these indicators indicate a slowdown in the US economy.

In addition, it has become obvious to market participants that the crisis, which knocked out American Silvergate Bank, Silicon Valley Bank, Signature Bank and European Credit Suisse, will cool the Fed's hawkish ardor and make it act much more cautiously. This opinion was confirmed on March 30 by the head of the Richmond Fed, Thomas Barkin, who said that the bankruptcy of Credit Suisse ruled out the option of further raising interest rates by 50 basis points (bp).

European macro statistics turned out to be quite diverse. On Thursday, March 30, the value of the Harmonized Consumer Price Index (HICP) in Germany became known, which rose in March by 7.8% y/y. This is less than a month ago (9.3%), but higher than the forecast (7.5%). As a result, looking at these figures, the market decided that the ECB would have to continue actively tightening monetary policy and raising euro rates in order to fight inflation. The yield of German government bonds outperformed the yield of similar US bills, and EUR/USD reached weekly highs. Friday's statistics, on the contrary, reassured bears on the dollar to a certain extent, as Eurostat reported that the Harmonized Consumer Price Index (HICP) fell in March in the euro area from 8.5% in February to 6.9% year-on-year (with a forecast of 7.1%).

The market reaction to this and other statistics on Friday (such as the US Personal Consumption Expenditure Index) was rather sluggish, as this day coincided with the last day of the Q1 2023, when many market participants have already recorded quarterly results in their reports.

Regarding the medium- and long-term prospects for EUR/USD, Bank of America (BoA) economists believe that “the market is again running ahead of the locomotive, incorporating early Fed rate cuts into prices, and reassessing these expectations is likely to put pressure on the pair in the short term.” According to the BoA forecast, “the EUR/USD rate will be 1.05 in the first half of the year, it will rise to 1.10 by the end of this year, and to 1.15 by the end of 2024, which is still below the long-term equilibrium value.” “We assume that the worst of the recent banking turmoil is behind us, but we remain concerned about two risks for the euro: the ongoing conflict over Ukraine and possible pressure on the Italian market from a hawkish ECB,” BoA explained.

If we talk about the outlook for the near term, at the time of writing, the evening of Friday, March 31, 55% of analysts expect further weakening of the dollar, 35% - its strengthening, and the remaining 10% have taken a neutral position. Of the oscillators on D1, 90% are colored green, and another 10% are colored red. Among trend indicators, 80% recommend buying, 20% - selling. The nearest support for the pair is located at 1.0800, then 1.0740-1.0760, 1.0680-1.0710, 1.0620 and 1.0500-1.0530. Bulls will meet resistance in the area of 1.0865, 1.0925, 1.0985-1.1030, 1.1110, 1.1230, 1.1280 and 1.1355-1.1390.

Of the upcoming week's events, the publication on Monday, April 03, of data on business activity (PMI) in the manufacturing sectors of Germany and the USA is of interest. This will be followed by a whole stream of information from the US labor market. This will be statistics on the number of open JOLTS vacancies on Tuesday, April 4, the change in the number of people employed in the non-agricultural sector from ADP on Wednesday, and the number of initial applications for unemployment benefits on Thursday. And on Friday, April 7, we will have data on the unemployment rate and the number of new jobs created outside the US agricultural sector (NFP). It must be borne in mind that April 07 is Good Friday in Europe, the USA and a number of other countries, a day off, so the reaction to these figures will follow next week, on Monday April 10.

GBP/USD: Will the Pair Continue to Grow?

The dollar weakened not only against the euro, but also against the British pound. GBP/USD has risen by more than 600 points since March 08, in just three weeks. Only the key resistance in the area of 1.2425-1.2450 could stop its growth. But does the pound have the strength to climb further?

On March 23, the Bank of England (BoE) raised its key interest rate by 25 bp. to 4.25% (for comparison, the current rate of the US Federal Reserve is 5.00%). At the same time, the situation with inflation in the country is not improving. The United Kingdom remains the only developed economy where inflation has hardly fallen throughout the year and remains at double-digit multi-year highs. The main Consumer Price Index (CPI) in March was 10.4%, and the basic CPI was 6.2%. Therefore, many analysts expect that the increase in interest rates will be one of the main steps taken by the BoE at the upcoming meetings. Moreover, the regulator will have to keep the rate at high values for a long time, even though this will stifle the country's economy. (GDP growth rates are now at near-zero levels. Thus, the data published on March 31 showed GDP growth in Q4 2022 by only 0.1%).

Pressure on the economy makes a number of analysts talk about the pound's limited potential. However, despite this, many strategists believe that a recession will be avoided, and the rate hike will continue to push the pound higher. Thus, ANZ Bank economists expect the pair to rise to 1.26 by the end of the year. The forecast of their colleagues from the French Societe Generale looks even bolder: in their opinion, GBP/USD will follow EUR/GBP and gradually move up to 1.30.

The pair closed last week at 1.2330. At the moment, 45% of experts side with the dollar, the same number (45%) side with the pound, the remaining 10% have taken a wait-and-see attitude. Among the oscillators on D1, the balance of power is as follows: 85% vote in favor of green and 15% have turned neutral gray. Among the trend indicators, the absolute advantage is on the side of the green ones, those are 100%. Support levels and zones for the pair are 1.2270, 1.2200, 1.2145, 1.2075-1.2085, 1.2000-1.2025, 1.1960, 1.1900-1.1920, 1.1800-1.1840. When the pair moves north, it will face resistance at levels 1.2390-1.2425, 1.2450, 1.2510, 1.2575-1.2610, 1.2700, 1.2750 and 1.2940.

Statistics on the UK economy include the publication of the Business Activity Index (PMI) in the country's manufacturing sector on Monday, April 3. The values of PMI in the services sector, as well as the composite value of this Index, will become known on Wednesday. And we remind you that Friday is a day off in the Kingdom.

USD/JPY: Will BoJ Change Course in the Summer?

Unlike its DXY “colleagues”, the Japanese currency has shown absolutely the opposite trend against the dollar. While the euro and pound were strengthening their positions last week, the yen was losing them. There are two reasons for this, in our opinion. First, the yen was pressured by the fact that March 31 is not only the end of the quarter, but also the end of the fiscal year in Japan. The second one, which has been said many times already, is the ultra-soft policy of the Bank of Japan (BoJ).

Kazuo Ueda, the new head of the regulator, who takes office on April 09, has repeatedly spoken out in favor of continuing the dovish course of his predecessor Haruhiko Kuroda. And of course, such statements do not contribute to the attractiveness of the national currency.

Since November 2022, concerns about financial instability have led to a surge in purchases of the yen as a safe haven. However, as Societe Generale strategists write, even the "safe harbor" needs change. USD/JPY needs more action from the BoJ to justify its big decline. If the Central Bank does nothing, USD/JPY is likely to rise even more. Societe Generale expects that any moves to change the monetary policy of BoJ will be made in June, which could send the pair to the 125.00 level. A sharp easing of the US Federal Reserve's policy can also help the Japanese currency.

The comments of economists from ANZ Bank look similar. “In the short term, [BoJ] policy change looks unlikely,” they write. “If it does change, which we expect to happen after the second quarter of this year, the Japanese yen will rise on more favorable yield differentials. We expect USD/JPY to fall gradually to 124.00 by the end of the year.”

Here, however, one must take into account the statement of the Deputy Governor of the Bank of Japan, Shinichi Uchida, made on Wednesday, March 29. According to him, the adjustment of the regulator's monetary policy to control bond yields is possible only if economic conditions and price stability improve, which will justify a gradual reduction in monetary stimulus.

So, the fall of USD/JPY to the zone of 124.00-125.00 is still a big question. It finished the last week at the level of 132.80. And as for the immediate prospects, at the moment, 40% of experts vote for the further movement of the pair to the north, 30% point in the opposite direction, and another 30% have abstained from forecasts. Among the oscillators on D1, 15% point south, 40% look in the opposite direction, and 35% are neutral. For trend indicators, 40% point to the north, the remaining 60% point to the south. The nearest support level is located in the zone 131.25, then there are levels and zones 130.50, 129.70-130.00, 128.00-128.15 and 127.20.  Resistance levels and zones are 133.00, 133.60, 134.00-134.35, 135.00-135.35, 135.90-136.00, 137.00, 137.50 and 137.90-138.00.

No important macro data on the Japanese economy is expected to be released this week. The only thing that can be noted in the calendar is Monday, April 03, when the Tankan Major Producers Sentiment Index for Q1 2023 will be published.

CRYPTOCURRENCIES: What Will Happen to Binance?


The crisis that crippled Silvergate, Silicon Valley Bank (SVB) and Signature and hit Credit Suisse has certainly helped the crypto market by reminding what decentralized finance was created for. However, investors' fears about a new wave of the banking crisis in the US and Europe are gradually fading away, which is clearly seen on the BTC/USD chart. If during the March 10-17 rally, digital gold gained almost 45% in weight, it has been unsuccessfully trying to storm the important $29,000 resistance for the last two weeks. Bitcoin needs not only to rise, but to sustainably gain a foothold above this horizon. Then, according to a number of experts, starting from this, it will be able to reach the next goal of $35,000. In the meantime, BTC is supported by the $26,500 level.

This support survived even when the CFTC (U.S. Commodity Futures Trading Commission) filed a lawsuit against Binance on Monday, March 27, accusing the crypto exchange of conducting unregistered futures and options transactions, serving US customers bypassing restrictions, illegal operations (in including in favor of Hamas, recognized as a terrorist organization in many countries) and market manipulation.

In relation to the last accusation, analyst Cory Swan has theorized that it was the founder of the Binance Changpeng Zhao (CZ) crypto exchange who was all this time the bear who tried to crash bitcoin to $12,000. “CZ held a large short position against BTC, hoping for $12,000, and paying for his personal big trade with unsecured BUSD and unsecured altcoins,” Swann writes.

At the moment, opinions are divided regarding the future of Binance. Some believe that no one needs the funeral of such a giant, as this will be a collapse for the entire crypto industry. Others are confident that the CFTC will seek the most severe punishment for the exchange. Even in the event of a pre-trial settlement, she will face billions in fines and a ban on work in the United States. If the court nevertheless takes place and finds Binance and its management guilty, both many clients and financial counterparties around the world will immediately turn away from them.

According to a CNBC survey of industry influencers, the market remains bullish on the future of the first cryptocurrency at this stage. So Tether CTO Paolo Ardoino believes that bitcoin can “retest” the all-time high of $69,000. And Marshall Beard, strategic director of the Gemini crypto exchange, predicts that the coin may reach $100,000 this year. In his opinion, if the first cryptocurrency manages to overcome the previous maximum, it “would not take much time to rise even higher.” However, a new bullish rally requires powerful new triggers, both economic and news. But neither the first nor the second has yet been observed.

Bloomberg strategist Mike McGlone believes that gold and bitcoin will be the most popular instruments for investors in 2023. The precious metal will confirm the status of the safest asset. The cost of a troy ounce of gold will soon exceed $2,000. At the same time, the attractiveness of bitcoin, which is seen as an instrument independent of the traditional banking system, will increase. As the global economy worsens, the number of investors who prefer to keep their capital in BTC, gold, as well as in treasuries, will grow, according to a note prepared by McGlone.

The collapse of the banking sector is reminiscent of the crisis of 1929, so the Fed is tightening monetary policy. After the latest rate hike, investment in bitcoin has increased, although many observers expected its value to fall, Bloomberg strategist emphasized. In his opinion, the BTC rebound can be seen as a positive signal, as more traders continue to buy cryptocurrency even amid global uncertainty.

Place Holder partner and former head of Ark Invest crypto company Chris Burniske, like Mike McGlone, believes now is the time to buy bitcoin and ethereum, as they are created for precisely such crisis moments.

Venture capitalist and billionaire Tim Draper made similar recommendations. Draper wrote in a report aimed at entrepreneurs that companies "can no longer rely" on just one bank or regulator. “For the first time in many years, governments are taking over banks at the risk of becoming insolvent. Bitcoin is a hedge against the financial domino effect and over-control mismanagement.”

Draper suggested keeping short-term deposits for no more than six months in two separate accounts, at a local bank and an international bank. In his opinion, organizations should also transfer an amount equal to two salary funds into bitcoin or other digital assets. The billionaire stressed the importance of such a contingency cushion, as management is responsible for meeting payroll deadlines "even in times of crisis."

Of course, as always, the voices of "crypto gravediggers" are heard. Thus, the analyst under the nickname Grinding Poet believes that “a retest of the 2018 lows is inevitable” and “the new target is $3,150.” The well-known gold bug and bitcoin critic Peter Schiff continues to stand his ground. Back in 2017, Schiff promised that the coin would soon be completely worthless. Despite the past 6 years, the entrepreneur has not changed his position. And now, in March 2023, he stated that “bitcoin’s zero price hike just dragged on a bit.”

Steve Hanke, professor of applied economics at Johns Hopkins University, criticized bitcoin again, saying that the fundamental value of the first cryptocurrency is zero. He called BTC a highly speculative asset with no economic value or utility.

Cake Defi CEO Julian Hosp told Hanke that bitcoin is debatable, but it certainly has value. According to Hosp, there are undoubtedly people who need bitcoin, so the claim that the first cryptocurrency has zero value is fundamentally wrong.

We tend to agree with Hosp, because at the time of writing the review, on the evening of Friday, March 31, BTC definitely has value and is expressed in a very specific figure of $28,375 per coin. The total capitalization of the crypto market has grown slightly over the week, from $1.169 trillion to $1.185 trillion. The Crypto Fear & Greed Index also rose from 61 to 63 points in seven days and is still in the Greed 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.

#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #cryptocurrencies #bitcoin #stock_market

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NordFX Brokerage company has summed up the performance of its clients' trade transactions in March 2023. The services of social trading, PAMM and CopyTrading, as well as the profit received by the company's IB-partners have also been assessed.

- The maximum monthly profit of 38,150 USD was received by a client from East Asia, account No. 286XX, on transactions with USD/CHF, USD/CAD and USD/JPY.
- This time, the second step was taken by their compatriot, account No. 1505XXX, who earned 26,955 USD trading the USD/JPY pair.
- And finally, a trader from South Asia, account No. 9605XXX, came in third place with a profit of 18,347 USD, their main trading instrument was the GBP/JPY pair.

The situation in NordFX passive investment services is as follows:

CopyTrading still pleases fans with a "veteran" signal, KennyFXPRO - Prismo 2K. It increased its profit to 355% in 697 days. Recall that despite the relative stability of the results, this supplier had a serious failure last November: the maximum drawdown on this signal approached 67% then. This can be called force majeure, but you should always keep in mind that trading in financial markets is a risky business, and can lead not only to impressive profits, but also to a complete loss of funds.
   
Another signal is Bull trader, which started on July 22, 2022, it has reached a profit of 183% over the past 248 days, with a drawdown of less than 23%. In addition, we drew the attention of algo trading fans a month ago to a startup called ATFOREXACADEMY ALGO 1. It celebrated a round date on March 31: it turned exactly 100 days old. It showed a very good profitability of 202% during this time, although its maximum drawdown turned out to be rather big, 38%.
   
In the PAMM service, two accounts continue to struggle in the financial markets, which we have repeatedly mentioned in previous reviews. These are KennyFXPRO-The Multi 3000 EA and TranquilityFX-The Genesis v3. They suffered serious losses in mid-November 2022: the drawdown at that moment approached 43%. However, PAMM managers managed to stabilize the situation, and profit on the first of these accounts reached 91% as of March 31, 2023, on the second - 58%, which is approximately the same as a year ago. |
   
This time, the Trade and earn account also attracted attention. It was opened more than a year ago, but was in a state of hibernation, waking up only in November. As a result, the yield on it has exceeded 55% over the past 5 months with a very small drawdown of less than 10%.

Among the IB partners of NordFX, the TOP-3 include representatives of East, South, and West Asia:
- the largest commission, 8,418 USD, was credited to a partner with account No.1259XXX;
- the next is the partner (account No. 1621XXX), who received 5,701 USD;
- and, finally, the partner with account No. 1618xxx, who received 4,536 USD as a reward, closes the top three.
 

Notice: These materials should not be deemed a recommendation for investment or guidance for working on financial markets: they are for informative purposes only. Trading on financial markets is risky and can lead to a loss of money deposited.

#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #cryptocurrencies #bitcoin #stock_market

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CryptoNews of the Week


- Cane Island Alternative Advisors analyst Timothy Peterson stated that 6 million of the 19.3 million bitcoins mined are irretrievably lost. “This means that there are only 13.3 million BTC left, and only 1.7 million BTC to be mined over 100 years. Another million [coins] will almost certainly be lost during this time,” he wrote. According to Peterson, as new bitcoins are mined, old ones are lost. He called the 13 million BTC circulating today “everything we are likely to have access to.”
Coinmetrics analysts calculated in April 2020 that 2.3 million BTC out of the 18.3 million BTC mined at that time were lost forever.

- Canadian artist Benjamin Von Wong, who created the Satoshi Skull mascot for Greenpeace, said his work was “never intended to fight bitcoin.” “I created the Skull believing that bitcoin mining was a classic black and white problem. I've dedicated my entire career to reducing hazardous waste emissions, and PoW intuitively felt insecure. Of course, I was wrong,” Von Wong wrote.
The artist noted that after talking with experts from the crypto sphere, he realized the prospects of blockchain technology. In his opinion, bitcoin “could potentially become more environmentally friendly” without changing the algorithm. “I am excited to hear from the bitcoin community that the first cryptocurrency could achieve negative CO2 emissions by the end of the decade,” added von Wong. And now, instead of fighting mining, the artist calls to join the crypto community and improve it from the inside.
On March 23, Greenpeace unveiled a mascot that represents the "dangerous amounts of pollution" caused by bitcoin mining. Will Foxley, director of media strategy at mining company Compass Mining, called the installation “really cool” and put a skull image on the profile avatar.

- Venture investor and billionaire Tim Draper has published recommendations for asset diversification, including using cryptocurrencies. Draper wrote in a report aimed at entrepreneurs that companies "can no longer rely" on just one bank or regulator. “For the first time in many years, governments are taking over banks at the risk of becoming insolvent. Bitcoin is a defense against the financial domino effect and mismanagement with excessive control,” the businessman said. He added that "many startups" turned to him for emergency help after the closure of Silicon Valley Bank (SVB), Silvergate Bank and Signature Bank.
Draper suggested keeping short-term deposits for no more than six months in two separate accounts, at a local bank and an international bank. In his opinion, organizations should also transfer an amount equal to two salary funds into bitcoin or other digital assets. The billionaire stressed the importance of such a contingency cushion, as management is responsible for meeting payroll deadlines "even in times of crisis."

- Oliver Linch, CEO of Bittrex Global, links the recent bitcoin rally to the US banking crisis caused by the collapse of Silvergate Bank, Signature Bank and Silicon Valley Bank. At the same time, according to a CNBC survey among influential figures in the industry, the market remains bullish about the future of the first cryptocurrency. So Tether CTO Paolo Ardoino believes that bitcoin can “retest” the all-time high of $69,000. And Marshall Beard, strategic director of the Gemini crypto exchange, predicts that the coin may reach $100,000 this year. In his opinion, if the first cryptocurrency manages to overcome the previous maximum, it “would not take much time to rise even higher.”

- Bloomberg strategist Mike McGlone believes that gold and bitcoin will be the most popular instruments for investors in 2023. The precious metal will confirm the status of the safest asset. The cost of a troy ounce of gold will soon exceed $2,000. At the same time, the attractiveness of bitcoin, which is seen as an instrument independent of the traditional banking system, will increase. As the global economy worsens, the number of investors who prefer to keep their capital in BTC, gold, as well as in treasuries, will grow, according to a note prepared by McGlone.
The collapse of the banking sector is reminiscent of the crisis of 1929, so the Federal Reserve tightens monetary policy. After the latest rate hike, investment in bitcoin has increased, although many observers expected its value to fall, Bloomberg strategist emphasized. In his opinion, the BTC rebound can be seen as a positive signal, as more traders continue to buy cryptocurrency even amid global uncertainty.

- Place Holder partner and former head of Ark Invest crypto company Chris Burniske, like Mike McGlone, believes now is the time to buy bitcoin and ethereum, as they are created for precisely such crisis moments.

- An analyst with the nickname The Wolf of Crypto found the history of the posts of the famous “gold bug” and bitcoin critic Peter Schiff and recalled that he buried BTC back in 2017. At the time, the coin was trading at $5,000, and Schiff promised that it would soon be completely worthless. Despite the past 6 years, the entrepreneur has not changed his position. And now, in March 2023, he stated that “Bitcoin’s zero price hike just dragged on a bit.”
Analysts recalled that bitcoin quotes rose by 47% after Schiff announced the need to sell assets amid fears caused by a banking collapse caused by the fall of Silicon Valley Bank (SVB).

 - Steve Hanke, professor of applied economics at Johns Hopkins University, criticized bitcoin, saying that the fundamental value of the first cryptocurrency is zero. He called bitcoin a highly speculative asset with no economic value or utility. It should be noted that Hanke himself is promoting initiatives related to the dollarization of Latin American countries.
Cake Defi CEO Julian Hosp responded to Hanke that BTC can be argued endlessly, but bitcoin definitely has value. According to Hosp, there are undoubtedly people who need bitcoin, so the claim that the first cryptocurrency has zero value is fundamentally wrong.

- The Central African Republic (CAR) will be the next country to legalize cryptocurrency at the state level, writes BeInCrypto. This decision was made after the discussion of the issue in the National Assembly. The debates were held behind closed doors, and after them, the President of the country, Faustin-Archange Touadera, supported the Central Bank's opinion regarding the FCFA cryptocurrency, which will have the status of legal tender in the CAR.

- Analyst Cory Swan has theorized that it was the founder of the Binance Changpeng Zhao (CZ) crypto exchange who was all this time the bear who tried to crash bitcoin to $12,000. “CZ held a large short position against BTC, hoping for $12,000, and paying for his personal big trade with unsecured BUSD and unsecured altcoins,” Swann writes.
A user under the nickname Grinding Poet believes that “Bitcoin at $12,000 is too optimistic. This is a big black swan and a retest of the 2018 lows is imminent. The new target is $3,150.”


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.

#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #forex #cryptocurrencies #bitcoin #stock_market

https://nordfx.com/

EUR/USD: ECB Not Fazed by Banking Crisis


The past week was marked by a large black candle when EUR/USD plummeted from 1.0759 to 1.0515. And this happened not on Thursday, March 16, when the ECB made a decision on the interest rate, but the day before. The reason for the weakening of the European currency was none other than the head of the National Bank of Saudi Arabia.

Here's what happened. Following the collapse of three banks in the United States, Silvergate, Silicon Valley, and Signature, the banking crisis spread to Europe, hitting Credit Suisse. This largest Swiss financial conglomerate has long been experiencing serious liquidity problems amid corruption scandals in Mozambique and rumors of dirty money from Bulgarian drug lords fueled by the media. And on Wednesday, March 15, it became known that the National Bank of Saudi Arabia, which is the largest shareholder of Credit Suisse, decided not to help the troubled Swiss with money anymore.

Credit Suisse's stocks fell more than 30%. But it didn't end there, and a wave of panic hit other major European banks. Societe Generale's shares fell by 12%, BNP Paribas - by 10%, Commerzbank - by 9%. In this situation, investors decided that the ECB would not dare to raise the rate by 50 basis points (bp), the likelihood of such a move dropped from 90% to 20%, which led to euro sales.

But as often happens, investors were wrong. Thursday came, and the European Central Bank did what it promised a month ago: raised the rate by 50 bp. In addition, concerns about the banking sector began to decline. The National Bank of Switzerland took on the salvation of Credit Suisse, and US authorities extended a helping hand to American banks, including the Treasury and the Federal Reserve. In addition, 11 more private banks joined the rescue operation, allocating $30 billion for these purposes. As a result, the storm subsided, EUR/USD returned to its comfortable zone of 1.0650, and market participants began discussing how much the US regulator would raise the interest rate on Wednesday.

Let's remind that the nearest FOMC (Federal Open Market Committee) meeting of the US Federal Reserve is scheduled for Wednesday, March 22. However, despite the hawkish statements of Jerome Powell and his colleagues, macroeconomic statistics suggest rather easing than further tightening of the Fed's monetary policy.

The data from the US labor market published on March 9 and 10 vividly demonstrate the slowdown of the country's economy. Thus, the number of initial jobless claims was 211K, exceeding the expected 195K and 190K a month earlier. This indicator exceeded the 200K mark for the first time and reached a maximum since December 2022. As for the number of new jobs created outside the agricultural sector (NFP), it was 311K, significantly less than in January - 503K. Together with the rise in unemployment to 3.6% (3.4% in January), the decrease in retail sales growth rates, and the banking crisis, these data may cool down the hawkish fervor of FOMC members. Currently, the likelihood of raising the federal funds rate by 25 basis points (from the current 4.75% to 5.00%) on March 22 is 80%. Moreover, derivatives predict a drop in the rate below 4% by the end of 2023, which is bad news for the dollar.

However, the European economy is not doing well either, which could prompt the ECB to take a less aggressive step. The swap market is almost 100% sure that on May 4, the euro regulator will raise the rate only by 25 basis points - from 3.00% to 3.25%.

EUR/USD closed the past five-day period at 1.0664. At the time of writing this review, on Friday evening, March 17, 40% of analysts expect the strengthening of the dollar, while the same percentage predicts its weakening, and the remaining 20% take a neutral position. Among the oscillators on D1, 75% are painted in green, another 10% are in red, and 15% are in neutral gray. Among the trend indicators, 90% recommend buying and 10% recommend selling. The nearest support for the pair is located in the area of 1.0590-1.0620, followed by levels and zones of 1.5000-1.0530, 1.0440, 1.0375-1.0400, 1.0300, and 1.0220-1.0255. Bulls will face resistance in the area of 1.0680-1.0700, 1.0740-1.0760, 1.0800, 1.0865, 1.0930, 1.0985-1.1030.

It is clear that the main event of the upcoming week will be the Fed meeting on March 22, the summary of forecasts, and the subsequent press conference of the organization's leadership. In addition, on Monday, March 20, the People's Bank of China will make its decision on the interest rate, which may affect the dynamics of the DXY dollar index. As for the end of the working week, on Thursday, March 23, another batch of data from the US labor market will be released, and on Friday, March 24, the indicators of business activity (PMI) in Germany and the Eurozone, as well as the volume of orders for capital goods and durable goods in the United States, will become known.

GBP/USD: UK Treasury Boosts the Pound

GBP/USD also marked a black candle on March 15, albeit slightly shorter at 170 pips. However, by the end of the week, the pound had fully recovered and even strengthened compared to the first ten days of March, finishing at 1.2175. This was due to increased optimism about the prospects of the British economy. The UK Chancellor of the Exchequer, Jeremy Hunt, presented the budget for the current year, the main goal of which, he said, was to stabilize the country's economy. It is expected that the UK GDP will decrease by only 0.2% this year, rather than 1.5% as previously expected, thus avoiding a technical recession. In addition, the inflation rate should decrease to 2.9% by the end of 2023, which is almost 3.5 times less than the peak value of 10.1%. Furthermore, the Chancellor announced a package of measures and benefits for individuals to help compensate for the shortage of labor.

Following the Federal Reserve's decision on interest rates next week, the Bank of England (BoE) will announce its own decision just 18 hours later. It should be noted that the head of the BoE, Andrew Bailey, speaking on Wednesday, March 1, was vague, stating that a final decision regarding the prospects of the monetary policy of the British central bank had not yet been made, and that the bank should be flexible in the coming months to avoid alarming the markets. Now, the regulator's caution will be further exacerbated by the banking crisis initiated primarily by the aggressive actions of colleagues on the other side of the Atlantic. And if previously, market participants were confident in raising interest rates by at least 25 basis points from the current 4.00% (and perhaps even by 50 basis points), now they have doubts – what if the BoE decides to take a pause to assess the situation and avoid making any mistakes?

At the moment, the majority of experts (50%) are on the side of the dollar, with only 10% voting for the rise of the British currency, while the remaining 40% remain in a wait-and-see position. Among the oscillators on D1, the balance of power is as follows: 85% voted in favor of the greenback (a quarter of them are in the overbought zone) and 15% in favor of the red. Among the trend indicators, the absolute advantage is on the side of the greenback, with 100%. The support levels and zones for the pair are 1.2145, 1.2075-1.2085, 1.2000-1,2025, 1.1960, 1.1900-1.1920, 1.1800-1.1840, 1.1720, and 1.1600. If the pair moves north, it will encounter resistance at levels 1.2200-1.2210, 1.2270, 1.2335, 1.2390-1.2400, 1.2430-1.2450, 1.2510, 1.2575-1.2610, 1.2700, 1.2750, and 1.2940.

As for events related to the UK economy, in addition to the BoE meeting, the next week's calendar includes Friday, March 24, when data on retail sales and business activity in the country's service sector will be released.

USD/JPY: Will the Interest Rate Go Even Lower?

The yen is the currency that is absolutely unaffected by the banking crisis in the US and Europe, on the contrary, it adds attractiveness to the Japanese currency as a quiet harbor capable of protecting against financial storms. Not even the statement by the departing governor of the Bank of Japan (BoJ), Haruhiko Kuroda, about the possible further reduction of the interest rate, which is already negative at -0.1%, has discouraged investors. As a result, USD/JPY ended the trading session where it had already been in early February, at the level of 131.80.

As for the nearest prospects, currently, 50% of experts have voted for the pair to move north, 25% have pointed in the opposite direction, and another 25% have refrained from making any forecasts. Among the oscillators on D1, 90% are pointing south (a third of them are signaling oversold), while 10% are looking in the opposite direction. All trend indicators are pointing south. The nearest support level is located in the zone of 131.25, followed by levels and zones of 130.50, 129.70-130.00, 128.00-128.15, and 127.20. Resistance levels and zones are at 132.80-133.20, 134.00-134.35, 135.00-135.35, 135.90-136.00, 137.00, 137.50, and 137.90-138.00.

No significant macro statistics related to Japan's economy are expected to be released next week. However, traders should keep in mind that Tuesday, March 21is a holiday in Japan: the Spring Equinox Day. And, of course, it should not be forgotten that the FOMC meeting of the US Federal Reserve is scheduled for March 22.

CRYPTOCURRENCIES: What's Bad for Banks Is Good for Bitcoin

In our last review, we listed a number of factors that negatively affect the crypto market. Among them are crypto repressions by US authorities, including the Treasury Department, SEC, Federal Reserve, Attorney General, Senate, and even the Biden administration. However, problems with altcoins and even upcoming changes in tax legislation pale in comparison to the crisis in the American banking sector. On March 8, the crypto bank Silvergate announced voluntary liquidation, followed by Silicon Valley Bank (SVB) and Signature Bank, which were actively used by crypto companies as fiat gateways. And last week, European banks were added to the list, as discussed above.

Silvergate suffered due to the debts of the collapsed crypto exchange FTX, while SVB and Signature were sunk by the Federal Reserve's monetary policy, including aggressive interest rate hikes and balance sheet reductions. "The 18th largest bank [SVB] has collapsed. We learned how the record sale of US Treasury bonds led to billions of dollars in unrealized losses in the banking sector. Thus, we received another example that a partial reserve system has creditors, not depositors," commented The Bitcoin Layer on the event. According to FDIC data, just in the last year, unrealized losses of US banks increased from $3 billion to $652 billion.

So, regulators first sent banks to the bottom, and then set about saving them. SVB and Signature have come under the control of the Federal Deposit Insurance Corporation. The latter, along with the Treasury and the Federal Reserve, stated that SVB and Signature Bank depositors will have access to all funds in full. In addition, the Federal Reserve announced the creation of the Bank Term Funding Facility (BTFP) to provide emergency financing to banks that may face similar problems, with $25 billion allocated for this purpose.

Against this background, the author of the bestseller Rich Dad Poor Dad and entrepreneur Robert Kiyosaki once again called for investment in gold, silver, and bitcoin. In his opinion, to save the "sick economy," regulators will print "even more fake money." "Take care of yourself. An emergency landing is ahead," Kiyosaki wrote.

Market analyst Tedtalksmacro called this move by the Fed the beginning of unofficial quantitative easing. And former CEO of BitMEX, Arthur Hayes, was even more categorical: "Get ready for a rapid rally in risky assets. The money printer is on! - he wrote. - Helping depositors of failed banks means injecting money into an economy from which liquidity has only been withdrawn over the course of a year. This is excellent fuel for risky assets."

Recall that at the beginning of March, we saw active outflows from institutional investors, who were scared off by regulators. In just one week, outflows from bitcoin funds amounted to a record $244 million. And now everything has changed: the BTC rate has jumped by more than 30%, and the overall cryptocurrency market capitalization has once again risen above $1 trillion. Market participants have remembered the potential of cryptocurrency as a capital protection tool and that Bitcoin was created precisely to withstand such shocks. Observers draw parallels with the Cypriot crisis of 2013, which highlighted the shortcomings of the fractional reserve system and drew attention to decentralized hedging in opposition to centralized banking.

According to some experts, what happened has been excellent advertising for bitcoin, whose price is expected to soar. However, there are skeptical voices as well. For example, CNBC's Mad Money host Jim Cramer continued to criticize the crypto industry, calling bitcoin a "strange animal." In his opinion, large financial institutions and wealthy investors manipulate cryptocurrencies in secret. "Please don't think everything is happening on its own," Cramer warned the audience, adding that he never believed in bitcoin.

The forecast given by well-known macro analyst and trader Henrik Zeberg also looks bleak. He evaluated the correlation between the level of unemployment in the US, the NAHB housing index, the stock market index, and cryptocurrencies, and noted the scary similarity of the current scenario to the 1929 crisis. According to the expert, all markets were "extremely overheated" and are now approaching an economic collapse that will last for several years. The impending recession may be much more severe than in 2007-2009. According to the analyst, the cryptocurrency market will also suffer greatly, and many digital coins will not withstand the pressure.

Zeberg presented a forecast for the macroeconomic recession based on Elliott wave theory. According to the research, wave 4 may reach its maximum level in early 2024. After that, major financial markets will be doomed to collapse. The specialist emphasized that all attention should be focused on the economic indicators of the third and fourth quarters of 2023, which may become the last "bullish" period of this market cycle.

As of the writing of this review on the evening of March 17, BTC/USD is trading around $27,500. The total market capitalization of the crypto market rose from $0.937 trillion to $1.155 trillion over the week. The Bitcoin fear and greed index increased from 34 to 51 points in seven days and moved from the Fear zone to 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.


NordFX Analytical Group


Notice: These materials should not be deemed a recommendation for investment or guidance for working on financial markets: they are for informative purposes only. Trading on financial markets is risky and can lead to a loss of money deposited.

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Over its 15 years in the financial markets, brokerage firm NordFX has accumulated more than 70 professional awards. In March this year, the company added two prestigious accolades from International Business Magazine to its collection. NordFX was honored as the "Most Reliable Forex Broker LATAM 2023" and the "Best CFD Broker Asia 2023".

International Business Magazine is a respected publication based in the United Arab Emirates, with global recognition and a substantial readership comprising professionals from various industries and regions. In 2019, the magazine was nominated for the esteemed European Digital Media Awards in the "Best News Publication" category. Receiving awards from such a renowned publication reaffirms NordFX's dominant position in areas like Latin America and Asia. The company offers its clients In these regions a comprehensive range of services, adhering to the highest industry standards in the Forex and CFD markets.
 

Notice: These materials should not be deemed a recommendation for investment or guidance for working on financial markets: they are for informative purposes only. Trading on financial markets is risky and can lead to a loss of money deposited.

#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #cryptocurrencies #bitcoin #stock_market

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CryptoNews of the Week


- Robert Kiyosaki, author of the bestseller Rich Dad Poor Dad and entrepreneur, has once again called for investing in gold, silver and bitcoin amid problems with US banks. In his opinion, regulators will print “even more counterfeit money” to save the “sick economy”. “Take care of yourself. Crash landing is ahead,” Kiyosaki wrote.
Kiyosaki made his announcement amid the recent collapse of major US banks Silicon Valley Bank (SVB) and Signature Bank, which were taken over by the Federal Deposit Insurance Corporation. The latter, together with the Treasury and the US Federal Reserve, said that SVB and Signature Bank depositors will have access to all funds in full. In addition, the Fed announced the creation of the Bank Term Funding Program for banks that may face similar problems (BTFP). $25 billion will be allocated for this purpose. Interestingly, both of these banks were actively used by cryptocurrency companies as fiat gateways.

- Aggressive rate hikes by the Fed and balance sheet cuts have led to bank failures in the US. According to a number of experts, this has become an excellent advertisement for bitcoin, the rate of which is expected to skyrocket. Observers draw parallels to the 2013 Cyprus crisis, which highlighted the shortcomings in the fractional reserve system and drew attention to decentralized hedging as opposed to centralized banking.
“The 18th largest bank [SVB] has collapsed. We have learned how a record sell-off in US Treasuries resulted in billions of dollars of unrealized losses in the banking sector. Thus, we have received another example of the fact that a fractional reserve system has no savers, but only creditors,” writes The Bitcoin Layer.

- Bitcoin reacted with a bullish rally to the news that the US authorities provided liquidity to rescue depositors of Silicon Valley and Signature banks. Market analyst Tedtalksmacro called this move by the Fed the beginning of unofficial quantitative easing. Former BitMEX CEO Arthur Hayes was even more blunt: “Get ready for a rally in risk assets. Money Printer Launched! - he wrote. - Helping the depositors to burst banks means injecting money into the economy, from which liquidity was only withdrawn during the year. This is a great fuel for risky assets.”

- After the aforementioned bankruptcy of these two banks, the BTC rate jumped by more than 30%. This made market participants think again about the potential of cryptocurrency as a tool for capital protection. Meanwhile, CNBC Mad Money host Jim Cramer continued to criticize the cryptocurrency industry. In the latest episode of his show, he expressed his skepticism regarding the coin's latest price rally. The host also called bitcoin a "strange animal". In his opinion, cryptocurrencies are secretly manipulated by large financial institutions and wealthy investors. “Please don’t think that everything happens by itself,” Cramer warned the audience, adding that he never believed in bitcoin.

- The US Treasury has called for the introduction of an excise duty for mining companies in the amount of 30% of the cost of electricity consumed. This is stated in the Green Book of the department. The tax is planned to be introduced in stages over the next three years, increasing by 10% each year. In addition, miners will be required to report how much electricity and what power they use. The new excise is expected to reduce the total number of mining devices in the US.
Another provision concerns individuals. The US Treasury is proposing that people with foreign financial accounts holding more than $50,000 worth of cryptocurrencies report those assets on their tax returns. Among other things, the agency is discussing the possibility of assessing the market value of digital assets and is proposing to expand the rules for securities lending to include cryptocurrencies.

- Gracy Chen, CEO of Bitget, one of the largest crypto exchanges, has revealed the content of her investment portfolio. “I have a cryptocurrency portfolio. About 41% is in BTC and ETH, 38% in USDT and USDC, 12% in BGB (this is the Bitget platform token). The rest is small amounts in such altcoins as BLUR, SHIB/DOGE, MANA/SAND, DODO, AVAX, YFI. I look forward to buying more BGB and BTC when the price drops. I have some NFTs, but they are not avatar pictures. I bought artistic NFTs, for example, VR paintings by French artist Anna Zhilyaeva. They are exclusively for my personal collections and not for speculation,” she admitted.
According to Gracy Chen, ethereum will face increased volatility and a pullback in the next 2-7 months after a short-term market rise. Due to the lack of external liquidity, as well as the fact that current investors are more speculative, in the medium term, the ethereum price may move in the range from $1,200 to $2,000. “Capital inflows into the cryptocurrency market will begin to increase ahead of the bitcoin halving. ETH is expected to reach strong resistance in the $2,400-$3,500 range in 2024,” the expert believes.

- The US Federal Bureau of Investigation (FBI) has warned of scammers who create fake mobile gaming apps and use them to steal crypto assets. Criminals position their apps as blockchain games based on the Play-to-Earn concept. Attackers contact victims online and invite them to play online games where players can be rewarded in crypto assets for certain actions (Play-to-Earn). For example, for growing crops on a virtual farm.
To take part in the game, victims need to download the game app, create a cryptocurrency wallet and buy assets. The more funds a user keeps in their gaming account, the greater their reward will be in the game, the scammers convince. When users stop topping up their account, criminals empty their wallets with malware that is activated when the game is downloaded.

- US Congressman Tom Emmer has once again opposed the launch of the state cryptocurrency. According to him, the digital dollar can be "easily weaponized" and used to spy on US citizens and to "crush politically unpopular activities."
The congressman noted that the cryptocurrency economy worries the US authorities, as it “takes power from centralized government institutions and returns it to the people.” Therefore, the idea of a controlled state cryptocurrency is becoming increasingly popular with regulators and law enforcement agencies.

- Henrik Zeberg, a trader and well-known macro analyst, has assessed the correlation between the US unemployment rate, the NAHB housing index, the stock market index and cryptocurrencies. The expert has noted the frightening similarity of the current scenario with the crisis of 1929, and has added that the markets are approaching an economic collapse that will drag on for several years. According to him, all markets were "extremely overheated, and the next recession could be much more serious than in 2007-2009." According to the analyst, the cryptocurrency market will also be hit very hard, and many digital coins will not withstand the pressure.
Zeberg has presented a forecast for a macroeconomic recession based on the Elliott wave theory. According to the study, wave 4 could reach its maximum level in early 2024. After that, large financial markets will be doomed to collapse. The specialist has emphasized that all attention should be focused on the economic performance of the third and fourth quarters of 2023, which could be the last bullish period of this market cycle.


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.

#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #forex #cryptocurrencies #bitcoin #stock_market

https://nordfx.com/

EUR/USD: USA Labor Market Stops USD

Jerome Powell played on the dollar side last week. Of course, the Fed Chairman knew that markets expected an interest rate increase of 25 basis points (bps) from the next FOMC (Federal Open Market Committee) meeting. But he did not rule out that his organization could take a more decisive step in an effort to curb inflation and raise it by 50 bp on March 22 at once. Moreover, it had been earlier expected that the rate would reach 5.00-5.25% at the peak. Now Powell and his colleagues do not rule out that its maximum value will be 5.50%. (According to Commerzbank strategists, even an increase to 6.00% is possible).

And so, to avoid a shock, the head of the Fed decided to prepare the markets for this in advance. His speech to the US Congress on Tuesday, March 7, was extremely hawkish, as a result of which the DXY Dollar Index updated its 2023 highs, soaring to 105.86, and EUR/USD lost more than 170 points, finding a local bottom at 1.0523. The probability of a 50bp rate hike in March rose to 70% (it was 23-30% a week ago, and the markets estimated it at only 9% a month ago).

However, the dollar could not build on its success, and EUR/USD turned north in the middle of the week. Data from the US labor market helped to lose ground. The number of initial applications for unemployment benefits published on Thursday March 09 amounted to 211K against the expected 195K and 190K a month earlier. This indicator exceeded the 200K mark for the first time since the first half of January and reached its maximum since the end of December 2022. In addition, short-term speculators began to take profits on the USD ahead of the report on the US labor market for February, published on Friday, March 10. And they did the right thing, as the dollar continued to retreat. The report showed that the number of new jobs created outside the agricultural sector (NFP) was 311K, which is more than the forecast of 205K, but significantly less than in January - 503K. Together with an increase in unemployment by 3.6% (forecast 3.4% and 3.4% in January), these data indicate a cooling of the country's economy, which in turn may cool down the hawkish ardor of FOMC members. This was confirmed by the dynamics of EUR/USD, which soared to a height of 1.0700 just a few hours after the publication of the report.

As for the euro area, the macro data looked neutral last week. Thus, the Consumer Price Index (CPI) in Germany, the locomotive of the European economy, remained at the same level and fully met the forecasts - 8.7% in annual terms.

The last chord of the week sounded at 1.0638. And despite the fall of the dollar at the end of the week, 80% of analysts expect it to strengthen in the near future, the remaining 20% have taken a neutral position, not a single vote has been cast for the growth of the euro. Among the oscillators on D1, 25% are red, another 25% are green, and 50% are neutral gray. Among trend indicators, 80% recommend buying, 20% - selling. The nearest support for the pair is located at 1.0600-1.0620, then there are levels and zones 1.5000-1.0530, 1.0440, 1.0375-1.0400, 1.0300 and 1.0220-1.0255. Bulls will meet resistance in the area of 1.0650, 1.0700, 1.0740-1.0760, 1.0800, 1.0865, 1.0930, 1.0985-1.1030.

There will be quite a lot of economic statistics next week. Moreover, it will certainly play a very important role in the decisions of both the Fed and the ECB. Thus, data on consumer inflation (CPI) in the US will be received on Tuesday, March 14. Data on retail sales in this country, as well as the US Producer Price Index (PPI), will be released the next day. The European Central Bank will decide on the euro interest rate on Thursday, March 16, which is expected to be raised by 50 bp., from 2.50% to 3.00%. Of course, the subsequent comments of the ECB management on monetary policy are also of absolute interest to market participants. And finally, the value of CPI in the Eurozone will become known at the very end of the working week, on March 17.

GBP/USD: Volatility Is High, the Result Is Zero


The result of the past five days for GBP/USD, despite the volatility of 310 points, ended up being close to zero. The pair finished the working week at the level of 1.2025, returning to the central zone of the side channel 1.1920-1.2145. The reason for this dynamics is the same as for EUR/USD, since both pairs were actively reacting to what was happening in the US. There were no important macro statistics from the United Kingdom all week until Friday, March 10, when the data on GDP and industrial production for January were released.

The first indicator showed an increase from -0.5% to +0.3% with a forecast of +0.1%, the second one, on the contrary, fell. UK manufacturing output fell from 0.0% to -0.4% in January against the forecast of -0.1%, while total industrial output was -0.3% m/m versus -0.2% and +0.3% expected in December. Thus, the data on GDP added optimism to the bulls on the pound, while the data on industrial production reduced it slightly.

According to Commerzbank economists, the Bank of England (BoE) is unlikely to help the British currency. Recall that the head of the Bank of England (BoE), Andrew Bailey, speaking on Wednesday, March 01, further fogged the issue, saying that the final decision on the prospects for the monetary policy of the British Central Bank has not yet been made, and that the regulator should be flexible in the coming months so as not to scare the markets. And as long as this regulator sticks to its rather cautious stance, unlike the Fed and the ECB, the pound is likely to remain under downward pressure. The Bank of England, instead of actively fighting high inflation, is likely to act as a catch-up, which will lead GBP/USD to further decline.

Experts' median forecast for the near term is similar to the forecast for EUR/USD: 75% of experts vote for the strengthening of the dollar and the fall of GBP/USD, the remaining 25% prefer to abstain from forecasts. Among the oscillators on D1, the balance of power is as follows: 35% vote in favor of greens, another 35% in favor of reds, and 30% in favor of neutral grays. Among the trend indicators, a clear advantage is on the side of the greens: 75% to 25% in their favor. Support levels and zones for the pair are 1.1985-1.2000, 1.1960, 1.1900-1.1925, 1.1840, 1.1800, 1.1720 and 1.1600. When the pair moves north, it will face resistance at the levels 1.2055, 1.2075-1.2085, 1.2145, 1.2185-1.2210, 1.2270, 1.2335, 1.2390-1.2400, 1.2430-1.2450, 1.2510, 1.2575-1.2610, 1.2700, 1.2750 and 1.2940.

As for the release of British macro statistics, next week's calendar includes Tuesday, March 14, when data on the unemployment rate and wages in the United Kingdom will be received.

USD/JPY: The Dollar Decides Everything

The meeting of the Bank of Japan (BOJ) was held at the very end of last week, on Friday, March 10, which was chaired for the last time by the former head, Haruhiko Kuroda. It went exactly as expected: the Japanese Central Bank did not change the parameters of its ultra-stimulating monetary policy, the interest rate again remained at the previous negative level of -0.1%.

Haruhiko Kuroda, speaking at his last press conference and commenting on the results of the last meeting of the Central Bank, said that the positive effect of monetary policy easing has significantly exceeded its side effects. At the same time, he noted that the regulator "will not hesitate to continue easing monetary policy if necessary" and that "it is important to continue to ease it in order to stimulate companies to raise wages." Kazuo Uedu, the new CEO of BoJ, is likely to follow his predecessor's precepts. At least, one should not expect any sharp steps from him.

At the moment, the American currency is decisive in this, as in other dollar pairs. After the release of data on the US labor market, the dollar fell to new lows around the world, while futures for US stock indices turned positive. If USD/JPY was trading at 137.90 on Wednesday, March 08, it found the bottom at 134.10 on March 10, and ended the week after a correction at 135.05.

As for the immediate prospects, 75% of experts vote for the pair's movement to the south at the moment, 25% point in the opposite direction. Among the oscillators on D1, 25% point north, 40% look in the opposite direction, and the remaining 35% look east. For trend indicators, 40% point north, and 60% look south. The nearest support level is located at 134.75 zone, followed by levels and zones 134.00-134.35, 133.60, 132.80-133.20, 131.85-132.00, 131.25 130.50, 129.70-130.00.  Levels and resistance zones are 135.15, 136.00-136.30, 136.70-137.10, 137.50, 139.00-139.35, 140.60, 143.75.

Among the events of the upcoming week, we can mention the publication of the Report on the last meeting of the Bank of Japan on Wednesday, March 15. Although, this document is unlikely to make a serious impression on market participants.

CRYPTOCURRENCIES: It's Really Bad. Will it get worse?

Bitcoin continues to be under pressure from an avalanche of bad news. A record $94 million in bullish positions for 2023 was liquidated on Thursday, March 10 alone. Analysts at Santiment are recording massive negative sentiment towards cryptocurrencies. The gloomy mood of players and investors has been influenced by:

1. Liquidation of Silvergate crypto bank. After the close of trading on the New York Stock Exchange on March 8, Silvergate Capital Corp., the American company that manages this bank, announced its intention to curtail its activities and voluntarily liquidate it. Given Silvergate's impressive customer base, this could cause a domino effect similar to last year's.

2. Potential U.S. government sale of $1 billion in bitcoin.

3. Possible tightening of the Fed's monetary policy, which has collapsed the quotes of all risky assets, including stocks and cryptocurrencies.

4. Continued crackdown on crypto exchanges. On March 09, the New York prosecutor's office filed a lawsuit against KuCoin, due to the lack of registration of this exchange in the United States as a securities broker. The fact is that Attorney General Letitia James, as well as SEC Chairman Gary Gensler, consider altcoins to be securities.

5. And finally, as icing on the cake, the proposals of the US President Biden's administration to ban crypto companies from tax maneuvers and to establish a 30% electricity tax for miners. A tax maneuver is a financial transaction when a company, with an unrecorded loss, first sells crypto assets and immediately buys them again, which reduces the amount of tax. The introduction of a 30% tax on electricity can deal a crushing blow not only to American miners, but also to the industry as a whole.

In our opinion, there is plenty of bad news for one week. Now let's try to add at least a few tablespoons of honey to this barrel of tar. According to Credible Crypto experts, at the moment, about 73% of all BTC coins are concentrated in the hands of experienced holders who are used to taking a hit and able to withstand the most severe crypto frosts. And Santiment reminds that such a total negative led earlier to a noticeable upward rebound in prices.

Eight Global CEO Michael Van De Poppe noted the importance of the next few weeks for bitcoin. “Capitalization could drop to $860 million, dragging the entire market down with it,” he warned. According to the expert's forecast, the price of bitcoin may fall to $19,700. Recall that he said just recently that in the worst case, the bottom could be even lower, at the level of $18,000, after which the coin will go up and could reach $40,000 this year.

Felix Zulauf, founder of hedge fund Zulauf Consulting, has suggested that bitcoin will head into a clear bull run sometime in late spring. The expert does not rule out that the asset could reach $100,000 on a sharp uptrend. Despite the bearish dynamics, Credible Crypto experts also remain optimistic about the medium-term prospects for the flagship crypto asset. They agree with Felix Zulauf that bitcoin may reach its all-time high this year. However, before a sustainable bull trend begins, the asset, in their opinion, will face several obstacles. (We have already listed five of them above)

Arthur Hayes, former CEO and co-founder of the BitMEX crypto exchange, believes that the bitcoin rally will start at a time when the global economy is in an oil crisis. In his opinion, a sharp increase in hydrocarbon prices will create conditions for the growth of digital assets and, first of all, bitcoin.

Hayes's logic is as follows: against the background of geopolitical tensions in the world, demand for energy resources will increase, as oil exporters are likely to reduce production. In this situation, the United States, as a leading economic power, will have to increase its own oil production. The Fed will need to ease the monetary rate to stimulate business activity in the energy sector. As soon as the regulator starts lowering interest rates, capital will return to risky assets, including cryptocurrencies. In addition, the former head of BitMEX recalled that the limited supply of BTC will also contribute to its growth, as the US dollar will lose ground.

It is appropriate here to cite data from the analytical platform WooBull, according to which the inflation rate of bitcoin is now at least three times lower than that of the US dollar. This allows BTC to act as a possible hedge against capital depreciation and economic uncertainty. Statistics show that the inflation rate of the first cryptocurrency has been steadily declining since its inception in 2009 and amounted to 1.79% as of March 04. At the same time, the same indicator for USD reached 6.4% in 2023, which is 3.57 times higher than that of BTC.

The decrease in bitcoin inflation is due to the asset's deflationary model, supported by halvings, which reduce the speed of coin mining and halve miners' rewards. Experts also believe that this indicator remains low due to the decentralization of BTC, which avoids most of the political and economic risks typical of the US dollar, whose inflation rate, on the contrary, will increase. This is primarily due to an excessive increase in the money supply, a decrease in demand and/or a reduction in production.

In the meantime, at the time of writing the review (March 10, 23:00 NordFX server time), BTC/USD is trading in the $20,070 zone. (the report on employment in the US has slightly supported the quotes). The total capitalization of the crypto market for the week fell below the psychologically important level of $1 trillion and is $0.937 trillion ($1.024 trillion a week ago). The Crypto Fear & Greed Index fell from 50 to 34 points in a week and moved from the Neutral zone to the Fear zone.

The forecast made by well-known cryptanalyst and host of DataDash YouTube channel Nicholas Merten causes fear as well. He did not rule out a new major drop in ethereum. According to the specialist, if we take into account previous bear markets when forecasting, ETH could fall by more than 90% from its historical high, that is, find itself at the level of several hundred dollars. “ETH/USD has a long way to go. “We're only 67% from the record,” Merten says. “And if we see again what we had in previous bear markets, say, a 92 percent correction or a 94 percent correction, the price of ETH will drop to several hundred dollars. The difference is huge, from $870 to about $500.”

We usually try to end our review on an optimistic note. But what if after a long crypto winter, instead of spring, we'll get another harsh winter? Although, let's still hope that the crypto calendar will be directly correlated with the regular calendar. And it is now the first month of spring, which should be followed by a warm sunny summer.


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Notice: These materials should not be deemed a recommendation for investment or guidance for working on financial markets: they are for informative purposes only. Trading on financial markets is risky and can lead to a loss of money deposited.

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CryptoNews of the Week


- Numerous studies show that despite the unpredictability of the cryptocurrency market, the number of active female investors is only growing every year. The volume of crypto assets traded by women increased from 15.2% in 2021 to 18.5% in 2022. And this happened at a time when the market was facing massive bankruptcies, liquidations and tightening of monetary policy by Central Banks.
According to statistics, female investors choose bitcoin in 21.6% of cases, followed by Tether USD with 21%. Ethereum, Shiba Inu and Dogecoin have also become popular assets. The most active age group is between 25 and 35 years old. The average net worth of a female investor in the UK is estimated at £9,650. And women cite the desire for financial independence as a key reason for investing in digital assets.

- Egyptian authorities arrested 29 people, including 13 foreign nationals, who stole more than $600,000 using the HoggPool scam network. The attackers launched an online platform in August 2022 and lured customers with the promise of “great financial gains” from cryptocurrency transactions. HoggPool went out of business in February, its organizers disappeared with clients' money. But then, the attackers were arrested when they reappeared with the intention of launching the Riot platform.
Back in early 2018, Egypt's chief mufti, Sheikh Shawki Allam, banned trading in crypto assets. It is illegal to engage in such activities in Egypt: you can get a prison term and a fine of up to $325,000. Despite this, Egyptian interest in cryptocurrencies remains high due to economic problems in the country.

- Michael Van De Poppe, CEO and founder of Eight Global, noted the importance of the next few weeks for bitcoin and allowed it to fall below $20,000.
Digital gold is holding in the $22,000-25,000 range so far. Crypto market capitalization has tested the highs of 2017, with the result that, according to van de Poppe, he is now “looking for a higher bottom.” According to the expert’s forecast, if the indicator falls below the 200-week moving average, the price of bitcoin will fall to $19,700.
 “Capitalization could drop to $860 million, pulling the entire market down by another 15%,” he warned.

- The executives of S&P Solutions, which operated under the Bitcoin of America brand, were accused of manufacturing and installing unlicensed Bitcoin ATMs used for fraud. According to the US Attorney's Office, the company's ATMs were not protected against money laundering, which is why they were actively used by various intruders. “S&P Solutions received a 20% commission for each transfer and continued to do so even after learning about fraudulent transactions,” the prosecutor’s office noted.
For reference, Bitcoin of America operates over 2,600 cryptocurrency ATMs in 35 states and is the fourth largest manufacturer of these devices in the country.

- The lack of clear regulation of the crypto industry in the United States threatens that companies will go abroad and offshore. This, in turn, will have a negative impact on users who “will remain vulnerable to fraudsters.” This opinion was expressed in an interview with Bloomberg by Ripple CEO Brad Garlinghouse. He emphasized the importance of adopting a legislative framework and clear regulation of cryptocurrencies, which, in his opinion, will contribute to the growth of the industry. Garlinghouse cited Ripple's legal battle with the Securities and Exchange Commission (SEC) as an example of the imperfection of the law, which showed how much the United States lags behind other countries in this direction.

- Arthur Hayes, former CEO and co-founder of the BitMEX crypto exchange, believes that the bitcoin rally will start at a time when the global economy is in an oil crisis. In his opinion, a sharp increase in hydrocarbon prices will create conditions for the growth of digital assets and, first of all, bitcoin.
Hayes's logic is as follows: against the background of geopolitical tensions in the world, demand for energy resources will increase, as oil exporters are likely to reduce production. In this situation, the United States, as a leading economic power, will have to increase its own oil production. The Fed will need to ease the monetary rate to stimulate business activity in the energy sector. As soon as the regulator starts lowering rates, capital will return to risky assets, including cryptocurrencies. In addition, the former head of BitMEX recalled that the limited supply of BTC will also contribute to its growth, as the US dollar will lose ground.
For the record: Arthur Hayes was charged with violating the Bank Secrecy Act in 2022 and sentenced to six months of house arrest, two years of probation, and a $10 million fine.

- More than 90% of bitcoins are currently in circulation, but the asset's inflation rate has dropped significantly in recent years. It is now at least three times lower than that of the US dollar. This allows BTC to act as a possible hedge against capital depreciation and economic uncertainty. According to the WooBull analytical platform, the inflation rate of the first cryptocurrency has been steadily decreasing since its creation in 2009 and amounted to 1.79% as of March 4. At the same time, the same indicator for USD reached 6.4% in 2023, which is 3.57 times higher than that of BTC.
The decrease in bitcoin inflation is due to the asset's deflationary model, supported by halvings, which reduce the speed of coin mining and halve miners' rewards. Experts also believe that this figure remains low due to the decentralization of BTC, which avoids most of the political and economic risks typical for the US dollar. On the contrary, the USD inflation rate will grow. This is primarily due to an excessive increase in the money supply, a decrease in demand and/or a reduction in production.

- Nicholas Merten, a well-known crypto analyst and presenter of the DataDash YouTube channel, has not ruled out a new major fall in ethereum. In his opinion, if we take into account previous bear markets when forecasting, ETH could fall by more than 90% from its historical high, that is, find itself at the level of several hundred dollars.
“ETH/USD has a long way to go. “We're only 67% from the record,” Merten says. “And if we see again what we had in previous bear markets, say, a 92 percent correction or a 94 percent correction, then the price of ETH will drop to several hundred dollars. The difference is huge, from $870 to about $500.”
Merten added that the current ETH price action looks very weak, as the altcoin has been stuck in a fairly narrow range for several months and cannot overcome the significant resistance at $1,800.

- Analysts at Santiment have identified massive negative sentiment towards cryptocurrencies. Experts find it difficult to establish the main reason for achieving such high levels. The researchers have noted that the cryptocrash hashtag trended on Twitter long before the 5% drop in the price of bitcoin, which occurred last Friday, March 03. Some members of the crypto community attributed the negative sentiment to problems with the Silvergate crypto bank and the recent SEC statement that all altcoins could be classified as securities.
The good news for investors, according to Santiment analysts, is that the total negative led to a noticeable rebound in prices previously. Felix Zulauf, the founder of hedge fund Zulauf Consulting, has suggested that bitcoin will move into a clear bullish rally sometime in late spring. The expert does not rule out that the asset could reach $100,000 on a sharp uptrend. He emphasized that bitcoin is now in the initial phase of a bullish cycle, which is confirmed by numerous on-chain metrics.

- Despite the bearish dynamics, Credible Crypto experts also remain optimistic about the medium-term prospects for the flagship crypto asset. In their opinion, bitcoin may update its historical extremum this year. However, the asset will face several hurdles before a steady bullish trend begins. Credible Crypto agrees that last year's bankruptcies are having a negative impact on the industry. However, about 73% of all BTC coins are concentrated in the hands of experienced holders who can withstand difficult times.


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.

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EUR/USD: Pause in the 1.0600 Zone


On Thursday, March 02, the DXY dollar index broke again through the bar at 105.00 points but could not stay there. As usual, the dollar was supported by an increase in US government bond yields. The yield on 10-year securities rose to its high since November 10 at 4.09%, the yield on 2-year securities rose to 4.91% and updated its maximum since 2007. The revision of US labor market statistics in Q4 2022 and the ISM Manufacturing Business Activity Index (PMI) in the country's manufacturing sector also supported the US currency. On the other hand, the dollar was pressured by the yuan, which is getting stronger against the backdrop of macro-economic statistics from China. The PMI manufacturing index in China was the highest since 2012. Activity in the service sector has also increased, and the Chinese real estate market has stabilized.

However, the main factor determining the dynamics of the USD is still the expectation of the Fed's further actions in an attempt to curb inflation. Since the Consumer Price Index (CPI) rose more than expected in January, reaching 6.4%, market participants started talking about the fact that the regulator may raise the rate not by 25 basis points (bp) in March, but immediately by 50. (At the moment, CME's FedWatch tool estimates the probability of such a move at 23%).

This forecast was supported by hawkish comments by some FOMC (Federal Open Market Committee) members. The head of the Atlanta Fed, Rafael Bostic, said that the key interest rate should eventually be raised to 5.00-5.25% and kept at this level until 2024. Minneapolis Fed chief Neil Kashkari has yet to decide whether he will vote for a 25bp or 50bp rate hike in March, but hinted that the Fed's own dot plot could be raised. At the same time, both officials stressed the need to fight inflation, emphasizing that a strong labor market and the US economy are able to withstand the pressure caused by the aggressive monetary policy of the Central Bank. However, Rafael Bostic then softened his hawkish mood and said that the regulator may suspend the rate hike cycle in the summer. After that, the dollar slightly retreated from its gains.

Some analysts do not rule out that the peak USD rate will reach 5.5% in September, and maybe even 6.0%. There is no question of reducing it at the end of the year at all. And these expectations play on the side of the US currency, which is confirmed by the futures market. But when talking about EUR/USD, one cannot focus only on the actions of the Fed. They don't sleep on the other side of the Atlantic either. Inflation data for a number of European countries suggest that the ECB will also be forced to maintain a hawkish position for longer than previously expected. The opening of the Chinese economy could put pressure not only on the US, but also on Europe, making it difficult for both regulators to curb inflation. Therefore, market participants expect further tightening of monetary policy on the part of the European Central Bank, which currently keeps the pair in the 1.0600 area.

Last week's finish was at 1.0632. At the time of writing this review (the evening of March 03), the analysts' forecast looks as uncertain as the flat quotes of EUR/USD: 50% of them have taken a neutral position, 30% of experts are counting on further strengthening of the dollar, and the remaining 20% side with the euro. Among the oscillators on D1, 50% are colored red, 15% are green and 35% are neutral gray. Among trend indicators, 35% recommend selling, 65% - buying. The nearest support for the pair is located at 1.0575-1.0605, then there are levels and zones 1.5000-1.0530, 1.0440, 1.0375-1.0400, 1.0300 and 1.0220-1.0255. Bulls will meet resistance in the area of 1.0680-1.0710, 1.0740-1.0760, 1.0800, 1.0865, 1.0930, 1.0985-1.1030.

There will be quite a lot of economic statistics and events in the coming week. Data on retail sales in the Eurozone will be released on Monday, March 06. Fed Chairman Jerome Powell will address the US Congress on Tuesday and Wednesday. Also, there will be data on retail sales in Germany, Eurozone GDP and employment in the US on Wednesday, March 08. The number of initial claims for unemployment benefits in the US and the inflation rate (CPI) in China will be known on Thursday. Friday 10 March will show what is happening with consumer prices in Germany. We are traditionally waiting for a portion of important statistics from the US labor market on the same day, including the unemployment rate and the number of new jobs created outside the agricultural sector (NFP).

GBP/USD: Sentiment Color Is Red

GBP/USD has been in a sideways channel for the second week in a row, although it has demonstrated rather high volatility. The range of its fluctuations (1.1942-1.2147) exceeded 200 points, and the last chord of the week was placed in the middle of this channel, at the level of 1.2040. We described above what gives strength to the dollar. The British currency received some support from information received last week that an agreement was reached between the UK and the EU on the Northern Ireland Protocol. Trade disputes have now been resolved, and while this is positive for the UK economy as a whole, many experts believe that the positive effect of this agreement for the pound will be short-term.

Quotes of the pair are still determined by the actions of the Central Banks. And the head of the Bank of England (BoE), Andrew Bailey, speaking on Wednesday, March 01, further fogged the issue., saying that the final decision on the prospects for the monetary policy of the British Central Bank has not yet been made, and that the regulator should be flexible in the coming months so as not to scare the markets.

Experts' median forecast for the near future is as follows: 70% of experts vote for the further weakening of the pound and the fall of GBP/USD, only 10% expect the pair to grow, and 20% prefer to refrain from forecasts. Among the trend indicators on D1, the balance of power is 65% to 35% in favor of the greens. The picture is different among oscillators. The reds have a convincing advantage here, 70%, 10% side with the greens, and 20% have taken a neutral position. Support levels and zones for the pair are 1.1985-1.2025, 1.1960, 1.1900-1.1925, 1.1840, 1.1800, 1.1720 and 1.1600. When the pair moves north, it will face resistance at the levels 1.2055, 1.2075-1.2085, 1.2145, 1.2185-1.2210, 1.2270, 1.2335, 1.2390-1.2400, 1.2430-1.2450, 1.2510, 1.2575-1.2610, 1.2700, 1.2750 and 1.2940.

As for next week's economic calendar, no important macro data from the UK is expected until Friday March 10, when UK GDP and industrial production data for January are released.

USD/JPY: Patience and Only Patience

USD/JPY rose to 137.10 on Thursday, March 02 after the release of US economic data. This is the highest level since December 20, 2022. The yen was opposed by the divergence between Fed and BoJ politicians, as well as the yield spread between 10-year US and Japanese bonds, which rose to its highs in March since November 2022.

Another blow to the Japanese currency was dealt by Kazuo Ueda, who was elected as the new head of the Bank of Japan (BoJ). His position only exacerbated the disappointment of those who hoped for major changes in the regulator's monetary policy. Investors have failed to pick up a clear "hawkish" signal in his speeches, which would have spurred the resumption of speculative demand for the yen, which was already weakening against the background of the growth of DXY and the rise in yields of 10-year treasuries.

USD/JPY met the beginning of February at the level of 130.08, and now it ends at 135.84 on March 03. However, a number of experts do not lose hope that the Japanese currency will strengthen. “Since the dollar peaked at the end of September, the yen became the second best-performing G10 currency by the end of January,” economists at MUFG Bank wrote. - Some backtracking in this context is quite understandable. But we believe that inflation will decline and yields around the world are close to peaks, which indicates a recovery in the yen, especially since the policy of the Bank of Japan will also change.”

Strategists from HSBC, the largest financial conglomerate, echo their colleagues. “We will remain yen bulls in the medium term,” their forecast sounds, "but we suspect that it will take some patience for the currency to gain independent strength thanks to the Bank of Japan. For now, USD/JPY is likely to remain influenced by developments in the US, where we see the balance of risk tilting towards a weaker dollar.”

The next meeting of the Bank of Japan will take place on Friday March 10. It will last be chaired by the former head, Haruhiko Kuroda, after which he will hand the reins over to Kazuo Ueda. Analysts at JPMorgan (like most others) do not expect BoJ policy to change or signal correction at this meeting. It is unlikely that Kuroda will slam the door loudly when he leaves; most likely, the interest rate will remain at the same negative level of -0.1%. Therefore, yen supporters can only follow HSBC's advice and be patient.

So, as already mentioned, a number of experts expect a serious strengthening of the Japanese currency in the future. In addition to MUFG Bank and HSBC strategists listed above, BNP Paribas Research has a similar position, while Danske Bank economists predict that USD/JPY rate will fall to the level of 125.00 in three months. In their opinion, in the event of a tightening of monetary policy, positive yields in Japan could stimulate the repatriation of funds by local investors, as a result of which USD/JPY will be around 121.00 by the end of 2023. But these are still rather shaky assumptions, although 60% of analysts agree with them. As for the immediate prospects, only 10% of experts are counting on the movement of the pair to the south at the moment, 45% are looking in the opposite direction, and the remaining 45% stay neutral.

Among the oscillators on D1, 85% point north, the remaining 15% look in the opposite direction. For trend indicators, 65% look north and 35% look south. The nearest support level is located in the zone 134.90-135.20, followed by the levels and zones 134.40, 134.00, 133.60, 132.80-133.20, 131.85-132.00, 131.25 130.50, 129.70-130.00.  Levels and resistance zones are 136.00-136.30, 136.70-137.10, 137.50, 139.00-139.35, 140.60, 143.75.

Among the events of the coming week, in addition to the above-mentioned meeting of the Bank of Japan, the calendar includes Thursday, March 9, when the country's GDP data for Q4 2022 will be published.

CRYPTOCURRENCIES: Bitcoin Awaiting a New Catalyst

The first sentence of the previous review was: “Bitcoin is under pressure, but it is holding up”. Starting the current review, we can only repeat: bitcoin is under pressure, but it is holding up. Let's talk about global news now. The good news is that the leading regulators will not completely ban cryptocurrencies. The bad news is that regulatory pressure on the industry will continue to grow.

The regulation of the crypto market was one of the topics that finance ministers and central bank representatives discussed at the G20 meeting. As a result, US Treasury Secretary Janet Yellen said that regulation of the crypto industry is important, while Washington is not considering a complete ban. “It is very important to create a reliable regulatory framework. And we are working [on this] with other governments,” she said in an interview with Reuters. IMF Managing Director Kristalina Georgieva agrees with her colleague: her organization also advocates for adequate regulation of digital assets and against their complete ban.

It should be noted here that the increase in regulatory control, while forcing a number of players out of their comfort zone, could ultimately have a positive impact on the industry, relieving shocks like the collapse of FTX. In addition, clear rules will attract a significant number of new institutional investors, raising the capitalization of the crypto market to unprecedented heights.

But this is in the future. In the present, the “herd” of whales (more than 1,000 BTC) continues to decline, reaching a three-year low of 1,663 individuals. There were almost 2,500 of them at its peak in February 2021. And this despite the fact that the crypto market showed a much better result at the beginning of 2023 than most of its participants and experts expected. These are the findings of Bank of America researchers.

At the moment, bitcoin quotes are supported mainly by small and medium-sized investors. According to analytics company Glassnode, the number of wallets with a volume of 1 BTC is constantly updating highs, approaching 1 million. The 30-day capital inflow to the market exceeded the outflow for the first time in 9 months and returned to the "green" zone. The cumulative net realized market value position also turned positive for the first time since April 2022 (the metric has been negative for the past nine months). Long-term holders have also updated their four-month high in savings.

By the way, according to Glassnode analysts, the drop in the number of whale wallets can be considered a positive factor. This means that the asset has become more distributed and less concentrated among a handful of large holders. This option is preferable for the entire ecosystem, as it eliminates the possibility of market manipulation by several players.

Another positive factor, according to some experts, is the weakening of the correlation of cryptocurrencies with US stocks and macroeconomic indicators. The flagship cryptocurrency was moving in a narrow range of $23,000-24,000 for almost the entire past week, and it sank a little only on Friday, March 03. Perhaps this was facilitated by the news that another representative of the crypto industry, Silvergate Bank from California (USA), was on the verge of bankruptcy.

According to analysts at the investment company Bernstein, the correlation of the first cryptocurrency with the Nasdaq Composite index has fallen from 0.94 to 0.58 since early February. According to them, the market is balancing between bulls and bears, "waiting for further catalysts", and its susceptibility to events in the world of traditional finance "is not the same as before."

We could also observe a weakening and then strengthening of the correlation with the stock market last August-September. And it is quite possible that the current “decoupling” of BTC from stock indices is a temporary phenomenon. It is clear that the main concerns for all risky assets are related to the continued increase in the key rate by the US Federal Reserve, which could become a catalyst for the resumption of the bearish trend of BTC/USD.

The Eight CEO Michael van de Poppe, a well-known trader, believes that bitcoin is currently the most undervalued asset. He has released a video review in which he predicts the growth of the coin to $40,000 this year. At the same time, both worsening macroeconomic data and the forecast for the Fed's rate failed to dampen Van de Poppe's optimism. From his point of view, a pronounced bullish divergence on the weekly chart indicates that we have already reached the bottom. What is happening now is just a bounce off the 200-week moving average and consolidating. According to the trader, a sideways movement is most likely at this stage. In the worst-case scenario, BTC/USD will fall to the low of the $18,000 range, and this fall will be a great investment opportunity.

According to Van de Poppe, there is no recession at the moment, but it may begin due to the collapse of the debt market and the real estate market. But before that happens, bitcoin could rise to $40,000, as the crisis usually unfolds 6-12 months after the Fed's significant rate hike. The signal for the start of a new bull rally could be either the lifting of the mining ban in China, or the adoption of cryptocurrency in Hong Kong.

Global financial disaster is also predicted by Robert Kiyosaki, author of a number of books on investing, including the bestseller Rich Dad Poor Dad. He has long been a critic of the Fed's monetary policy and has expressed concern about the devaluation of the dollar. And now the economics writer has made a bold statement that, in his opinion, the fake dollar is leading to the decline of the American empire. This stance of Kiyosaki has drawn approval from the crypto community as it shows the benefits of bitcoin. Experts note that digital assets such as BTC, unlike fiat currencies, are not subject to inflationary pressure, since their supply is limited and predetermined by appropriate algorithms.

Recall that Kiyosaki has recently predicted that the bitcoin rate will rise to $500,000 by 2025. “A giant crash is coming. Depression is possible. The Fed has been forced to print billions in counterfeit money. Gold at $5,000, silver at $500, and bitcoin at $500,000 by 2025,” he wrote. And he added that gold and silver are the money of the gods, and bitcoin is like a dollar for ordinary people.

Matt Hougan, chief investment officer at Bitwise, said in a recent interview that he is “epically optimistic for the next three years.” In his opinion, there will be a massive adoption of cryptocurrency in 2023-2025 and its prices will grow. “This bull market cycle is going to be the biggest cycle in terms of user adoption, in terms of the cumulative increase in market capitalization, in terms of just about every other thing we care about,” the financier says. “But it won’t happen perfectly up and to the right.” Also, “I'm actually optimistic about regulation,” Matt Hougan added.

Apple co-founder Steve Wozniak was also bullish last week. In his opinion, the main cryptocurrency has a huge potential and will increase in value in the coming years, reaching $100,000.

In the meantime, at the time of writing this review (Friday evening, March 03), BTC/USD is trading in the $22,250 zone. The total capitalization of the crypto market is $1.024 trillion ($1.059 trillion a week ago). The Crypto Fear & Greed Index fell from 53 to 50 points in a week and is in the very center of the Neutral zone.

And finally, news that can be attributed to our crypto life hacks section. It concerns those who do not like the regulatory press, which we talked about at the beginning of the review. So, it became known that the government of Ras Al Khaimah (RAK), one of the UAE's emirates, plans to create a free zone for companies in the digital asset industry. According to the announcement, RAK Digital Assets Oasis will become a hub for unregulated industry activity, with applications open as early as Q2 2023.


NordFX Analytical Group


Notice: These materials should not be deemed a recommendation for investment or guidance for working on financial markets: they are for informative purposes only. Trading on financial markets is risky and can lead to a loss of money deposited.

#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #cryptocurrencies #bitcoin #stock_market

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