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Daily Market Analysis from NordFX

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New NordFX Super Lottery: 202 Prizes in 2022

Daily Market Analysis from NordFX in Fundamental_zQ2SMLl

The NordFX brokerage company started a new super lottery on March 1, which will give away 200 cash prizes of 250, 500 and 1,250 USD, as well as 2 two super prizes of 10,000 USD each. The total prize fund will be 100,000 USD.

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The first lottery was held in 2021 and was a great success: more than 20 thousand tickets participated in it. The draws were held online using an electronic lottery drum, and everyone could follow them. And now, a year later, the NordFX brokerage company has decided to hold a new lottery. Its slogan is More Prizes, More Winners. 202 prizes will be drawn in 2022 in three stages: 140 prizes of $250, 40 prizes of $500, 20 prizes of $1,250 and 2 super prizes of $10,000. Draws will take place on July 04, October 04, 2022, and January 04, 2023.

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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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#106 - March 04, 2022, 04:56:03 PM

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Forex and Cryptocurrency Forecast for March 07 - 11, 2022


EUR/USD: The Fate of the Euro Is Decided in Ukraine

Daily Market Analysis from NordFX in Fundamental_kXTaon5

Macro statistics were mixed last week. But few people pay attention to it at the moment. The dynamics of European currencies is determined by what is happening in Ukraine for the second week now. The escalation of the Russian-Ukrainian armed conflict is intensifying, increasing the demand for risk-free assets. And it is the dollar that acts as such, not the pan-European currency.

The difference in the monetary policies of the Fed and the ECB pushed the EUR/USD pair down both in 2021 and in January-February 2022. The tragic events of recent days have only given it an additional downward impetus. How else can the market react, say, to a rocket attack in the area of Europe's largest Zaporozhye nuclear power plant, located in southern Ukraine? The fire that arose not far from its power units was extinguished, but this did not make it any easier: Chernobyl has not been forgotten in Europe yet, and no one wants a new nuclear catastrophe that could claim millions of lives.

The negative outlook is reinforced by the extraordinarily tough economic sanctions that the EU has imposed against Russia to support Ukraine. They create huge problems in the supply of Russian energy resources to the EU, seriously limit industrial trade, and tighten the banking sector in a grip. It is difficult to imagine how, in such a situation, the ECB will be able to curtail monetary stimulus and raise interest rates. As for the US Federal Reserve, this regulator is unlikely to abandon its plans.

Speaking in Congress on Wednesday, March 02, Fed Chairman Jerome Powell named a number of advantages of the US currency. The first is the flight of investors from risk to such safe-haven assets as the dollar due to the events in Ukraine. Other trump cards include divergence in monetary policy with European countries and the growth of the US economy. By the way, such an important indicator as the number of new jobs created outside the US agricultural sector (NFP) has confirmed Powell's words, showing real growth to 678K against a forecast of 400K (481K a month ago).

Also, the US Central Bank believes that due to the events in Ukraine and the influence of Russia on commodity markets, inflation will be higher than previously predicted. And this, as Jerome Powell said, will require a more vigorous increase in interest rates. That is, they may be even higher by the end of 2022 than the market expects.

The previous week's forecast suggested that the EUR/USD pair would retest support at 1.1100, after which the bears would try to reach the landmark horizon of 1.1000. Such a scenario seemed very bold and almost unbelievable on February 25. But the events described above led to the fact that the pair easily broke through the seemingly "impenetrable" support of 1.1000 and collapsed to 1.0885, having lost 385 points in a week. The last chord, after a small correction, sounded at the level of 1.0932.

Amid mounting geopolitical tensions, the euro has lost more than 600 points to the dollar since February 10 and is now rapidly approaching the 2020 lows. And it is not far to parity 1:1. It is extremely difficult to predict where the bottom will be in the current situation. It was at around 1.0635 in 2020, the pair was falling to 1.0325 in 2016. Perhaps these values will become support levels.

As for the bulls, taking into account the increased volatility, their immediate goal is a return to the 1.1000 zone, followed by resistance in the 1.1100-1.1125 area, then a wide zone of 1.1280-1.1390, then - the highs of January 13 and February 10 in the 1.1485 area. However, the pair will be able to achieve them only if hostilities cease or, at least, when a stable truce is concluded. Most analysts hope for the best: 65% of them vote for the fact that EUR/USD will be able to return to at least 1.1200 within March. But trend indicators and oscillators on D1 have a completely different opinion: they are all colored red, although 25% of the latter are in the oversold zone.

As for economic statistics, data on retail sales in Germany will be published on Monday, March 07, then the data on GDP in the Eurozone on Tuesday. The event of the week can be Thursday, March 10, when the ECB meeting will take place. The interest rate is likely to remain the same at 0%, so the subsequent press conference of the regulator's management will be of more interest. Data on the US consumer market will come out on the same day, and we will find out the values of the harmonized consumer price index in Germany and the US University of Michigan consumer confidence index at the very end of the week, on Friday, March 11.

GBP/USD: Great Britain Is Europe as Well

The EU's dependence on Russian gas was about 45-50% before the introduction of sanctions. Unlike the countries of the European Union, the UK is practically independent of Russian gas supplies: this figure is less than 3%. Its trade turnover with the Russian Federation is much lower as well. And geographically, it is separated from the zone of the armed Russian-Ukrainian conflict by about 2,000 kilometers.

All these factors helped the GBP/USD pair to stay in a sideways trend for several days. But against the backdrop of events around the Zaporizhzhya NPP, it still could not resist and updated the February 24 low, dropping to the level of 1.3201. The week finished at 1.3246.

The experts' forecast for the pair for the next week is as follows: 50% of them vote for moving north and 25% for further movement to the south, the remaining 25% vote for a sideways trend. The indicator readings on D1 fully coincide with the readings for the EUR/USD pair. Strong support lies at 1.3170 (December 2021 lows), followed by 2020 supports. Resistance levels are 1.3270-1.3325, 1.3400, 1.3485, 1.3600, 1.3640.

Highlights of the upcoming week include the release of retail sales data for the UK on Tuesday March 08, and the release of UK output and GDP on Friday March 11.

USD/JPY: Yen or Dollar: Which Safe Haven Is Better?

Japan is even further from Ukraine than the UK, as much as 8,000 kilometers. Although it has joined the sanctions against Russia, this has not ceased to be a safe haven for investors. Therefore, everything that literally makes Europe feverish does not affect the dynamics of the USD/JPY pair. It continued to move along the 115.00 horizon last week, fluctuating in the range of 114.65-115.77. And it completed the five-day working week not far from its lower border, at 114.81. This decrease occurred on Friday, March 04, not because of the shelling of the Zaporizhzhya nuclear power plant, but because of the fall in the yield of US Treasury bonds.

That is, when the dollar rose against the euro and the pound, it fell against the yen. Competition between these two safe-haven assets will undoubtedly continue next week. 75% of analysts believe that the pair will return to the upper limit of the channel, while 25% believe that it may fall further down. As is usually the case in such situations, disagreements immediately arise among the indicators. Among the trend indicators on D1, 65% are for selling, 35% for buying. Among the oscillators, 20% vote for the purchase, 25% vote for the neutral status and 55% are for the sale, but at the same time, a quarter of them have signaled that the pair is oversold. The nearest resistance zone is 115.00-115.25, then 115.70. The main goal of the bulls is to renew the high of 116.34 and rise to where the pair has not been seen since January 2017. Support levels and zones: 114.40-114.65, 114.15, 113.75, 113.45, 113.20, 112.55 and 112.70.

The release of any significant macro statistics on the state of the Japanese economy, with the exception of data on GDP on Wednesday, March 09, is not expected next week.

CRYPTOCURRENCIES: Sanctions, Bitcoin and What Robots Choose

Immediately after the Bank of Russia asset freeze due to hostilities in Ukraine, bitcoin trading volumes increased sharply on Monday, February 28, and the coin itself jumped in price by almost 17% (from $37,840 to $44,220). The number of bitcoin addresses with balances over 1,000 BTC increased by more than 6% to 2,226. The indicator had not reached this level since March 2021. The number of addresses with a balance of 100 to 1000 BTC  also increased on February 28, although not as noticeably. The indicator increased by 1.3%, to 15,929 over the day. This is evidenced by the data of the Glassnode service.

Some analysts suggest that such a rapid increase in the number of bitcoin whales is due to the attempts of the Russian elites to withdraw their assets to circumvent the sanctions and convert the depreciating rubles into cryptocurrency.

According to Bloomberg, the National Security Council of the White House and the US Treasury Department appealed to the operators of the world's largest centralized exchanges with a request to stop any attempts to circumvent the sanctions imposed on Russia. The White House spokesman said that cryptocurrencies are not a replacement for the US dollar, which is widely used in the Russian Federation. However, the US authorities intend to combat their misuse. European Central Bank President Christine Lagarde also called for increased regulation of digital assets in the euro area.

At least four cryptocurrency exchanges, including Coinbase and Gemini, have said they will take steps to tighten controls.

According to well-known economist and analyst Alex Kruger, if Russia uses cryptocurrencies to circumvent sanctions, this will be enough for US regulators to ban digital assets altogether. "Don't expect this to happen. But be careful in your actions,? he warned, adding that if the geopolitical situation does not worsen, investors will soon see the growth of the crypto market.

The dynamics of the cryptocurrencies? movement between private and exchange wallets indicates the lack of certainty among investors regarding the further developments in the digital asset market. This is written by CoinDesk with reference to the report of Bank of America (BofA).

According to analysts, the tightening of the Fed's policy and macroeconomic factors will limit the growth of cryptocurrencies in the next six months. However, BofA emphasized that this will not be the beginning of a new "crypto winter", as the level of adoption of digital assets by users and the activity of developers has increased significantly.

The bank also added that it will be difficult for the digital asset market to move out of the current price range until fears of a possible recession are discarded.

After the jump on February 28, the upward movement of the BTC/USD pair slowed down on March 01-02, when approaching the strong $45,000 resistance zone. And then, after an unsuccessful attempt to break further up, it turned back to the south. (Recall that this resistance had already sent the pair down several times in January-February).

If the flagship currency still manages to rise above $45,700 at some point, we can expect its further growth to $47,000-50,000 due to the triggering of a large number of buy orders.

Legendary trader Henrik Zeberg, author of The Zeberg Report and expert on macroeconomic cycles, presented three charts to show that major stocks and cryptocurrencies are poised to rise in Elliot Wave 5. According to Zeberg, the most important stock market indices S&P500 and Nasdaq are approaching bullish reversals on the weekly charts. If his prediction comes true, bitcoin could once again increase its correlation with stocks and indices.

At the time of writing (the evening of March 04), the BTC/USD pair is trading around $39,300, the total market capitalization, after rising to $1.963 trillion, returned to the values of a week ago at $1.755 trillion, and the Crypto Fear & Greed Index grew by only 6 points (from 27 to 33 points), having firmly stuck in the zone of Fear.

Bloomberg Intelligence Chief Strategist Mike McGlone reiterated that bitcoin is well on its way to becoming an international reserve asset. He assured that the BTC rate will reach $100,000 in 2022. The analyst also emphasized that the price of the flagship digital currency will not drop to $30,000 despite the bearish sentiment in the market.

McGlone also believes that such coins as Dogecoin must lose their influence in order for bitcoin to finally establish itself as a reliable tool for protecting money savings.

An AI robot advisor created by Portuguese software developer Tiago Vasconcelos has supported Bloomberg Intelligence's chief strategist's point of view. The coder "trained the bot, explained the rules, candles, principles when you can either buy or sell, or do nothing." The bot receives one point for each profitable trade and loses it as a "punishment" for unprofitable trades. having talen thousands/millions of steps to increase the balance of the trading account, the robot advisor eventually opted for a ?hodling? strategy, that is, accumulating bitcoin. (Recall that Hodl is a popular meme in the bitcoin space that arose from a message on the Bitcointalk forum in 2013 with a misprint in the word ?hold?).



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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.

#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #cryptocurrencies #bitcoin #stock_market
#107 - March 06, 2022, 01:03:34 PM

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Forex and Cryptocurrency Forecast for March 14 - 18, 2022


EUR/USD: Mega Event of the Week: US Federal Reserve Meeting

As expected, the main event of the past week was Thursday, March 10th, thanks to the meeting of the European Central Bank. The interest rate was left at the same level of 0%, and this was no surprise to anyone. But despite the absolute predictability of this decision, the EUR/USD pair first soared to 1.1120 after the statement of the regulator, and then fell below 1.1000. It's all about the failed attempt to "feed" both hawks and doves.

On the one hand, the ECB surprised everyone with its hawkish decision to roll back QE more quickly. Asset buyback volumes under QE will be reduced from ?40bn in April to ?30bn in May and to ?20bn in June, which is significantly ahead of the previous forecast. It had been Previously assumed that the reduction to ?20 billion could occur only by October.

However, the position of the ECB on the issue of raising the interest rate has become even more dovish than it was. The regulator stated Earlier that a very small time gap is planned between the QE curtailment and the subsequent rate hike. Now, according to the head of the Central Bank, Christine Lagarde, "any adjustment of the ECB key rate will occur only some time after the end of bond purchases and will be gradual." Such a dovish statement disappointed investors and pushed the EUR/USD pair down.

An additional impetus to the sell-off of the euro came from the inflation report in the US, where consumer price growth reached a 40-year high. Thus, in monthly terms, the consumer price index increased from 0.6% to 0.8%, and in annual terms, inflation accelerated from 7.5% to 7.9%. These data further confirmed the markets in confidence that the increase in the US federal funds rate will take place already at the next Fed meeting, which is to be held next Wednesday, on March 16. Moreover, Jerome Powell, the head of the US Central Bank, said that he plans to propose a 0.25% rate increase at this meeting.

Naturally, inflation is growing not only in the US, but also in Europe. The ECB raised its growth estimates in 2022 from 3.2% to 5.1%. And according to experts at Goldman Sachs, this figure could rise to 8%.  But the divergence in monetary policy and economic prospects is clearly not on the EU's side. The geographical factor should also be taken into account: proximity to the zone of armed conflict in Ukraine, as well as Europe's dependence on Russian energy carriers.

At present, Europe bears the main losses from the sanctions imposed against Russia. Analysts believe that it is facing a steady stagflation. The US is not immune from slowing economic growth either. But it is one of the world's leading oil suppliers and have significant shale gas reserves, so it will be much less affected by skyrocketing energy prices. In addition, savings accumulated by American households during the COVID-19 pandemic are now at an all-time high. This financial cushion dampens inflationary pressures, allowing the Fed to pursue a tighter monetary policy.

The EUR/USD pair slightly won back the losses of February over the past week and completed the five-day period at the level of 1.0911. However, in the event of an escalation of hostilities in Ukraine and an increase in mineral fuel prices, the nearest strategic target for the bears will no doubt be a retest of the March 07 low of 1.0805. This will be followed by the 2020 low of 1.0635 and the 2016 low of 1.0325. In the previous review, we already expressed the idea that the quotes may be at the level of 1.0000 at some point. This forecast was supported by ABN Amro bank strategists, who consider the fall of the pair to parity as the baseline scenario.

On the other hand, even a slight hint of a diplomatic settlement of the situation in Ukraine, not to mention the complete cessation of hostilities, can provide serious support to the common European currency and lead to its growth. Given the increased volatility, the nearest target for the bulls is a breakdown of the resistance zone around 1.1000. Then there are zones 1.1100-1.1125, 1.1280-1.1390 and the highs of January 13 and February 10 in the area of 1.1485.

Analysts' opinions are distributed as follows. 50% of them vote for the fact that EUR/USD will be able to return to at least 1.1200 within March. 25% side with the bears, and the remaining 25% have taken a neutral position. Oscillators on D1 are 90% red, 10% are neutral gray. Trend indicators are 100% on the side of the bears.

As for the calendar for the upcoming week, as already mentioned, the US Fed meeting on Wednesday, March 16 will be a mega event. And statistics on retail sales in the United States will be released a few hours before the release of the final commentary and the press conference of the regulator's leadership. Attention should be paid to the speech of the head of the ECB, Christine Lagarde the next day, on Thursday, March 17, as well as to data from the consumer market of the Eurozone and from the US labor market.

GBP/USD: What to Expect from the Bank of England?

The EU's dependence on Russian gas was about 45-50% before the imposition of sanctions. Unlike the countries of the European Union, the UK is practically independent of Russian gas supplies: this figure is less than 3%. Its trade turnover with the Russian Federation is also much lower. And geographically, it is separated from the zone of the armed Russian-Ukrainian conflict by about 2,000 kilometers. All these factors enable the Bank of England, in contrast to its colleagues from the ECB, to act more decisively in the normalization of its monetary policy.

There will also be a meeting of the Bank of England on March 17, the day after the Fed meeting. And it is quite possible that the decision of the UK regulator on the interest rate will depend on how much the US Central Bank will raise (or not raise) its rate on the eve. This is an additional factor of uncertainty when predicting the exchange rate of the British currency.

Recall that the Bank of England was the first to raise the rate, raising it to 0.5%. But it is still unclear how long its hawkish fuse will last.

Experts' forecast for the GBP/USD pair for the next week is as follows: 35% vote for the movement to the north, 35% - for further movement to the south, the remaining 20% vote for the sideways trend. However, when moving to a monthly forecast, bull supporters get a clear advantage: those are 65%, with 15% of the votes cast for bears and 20% of abstentions. All 100% of the indicators on D1 are facing south at the time of writing the review, however, 30% of the oscillators signal that the pair is oversold.

The pound finished the weekly trading session at 1.3035. The nearest support is located in the zone 1.2985-1.3025, followed by the 2020 supports. Resistance levels are 1.3080, 1.3145, 1.3200, 1.3270-1.3325, 1.3400, 1.3485, 1.3600, 1.3640.

Aside from the Bank of England meeting, next week's events include the publication of data from the UK labor market on Tuesday, March 15, including the average wage level in the country, as well as changes in the number of applications for unemployment benefits.

USD/JPY: Markets Have Chosen the Dollar

Daily Market Analysis from NordFX in Fundamental_oziZt4m

We put the question: ?Yen or Dollar: Which Safe Haven Is Better?? in the title of the previous USD/JPY review, implying that when the market is in a panic, investors start looking for the safest place to store their capital.

The dollar won this dispute last week. It not only won, but by a wide margin. Having started at 114.81, on Friday March 11, the USD/JPY pair peaked at 117.35, and the last chord of the week sounded a little lower at 117.25. Recall that the vast majority of experts (75%) predicted the growth of the pair, but almost no one expected the breakthrough to be so powerful and all-destroying. As a result of this blitzkrieg, the pair not only renewed the January-February high of 116.35 but reached the zone where it had been traded for a very, very long time, at the turn of 2016/2017.

Experts cite the fact that the Bank of Japan still prefers to refrain from cutting economic stimulus, as the reason for such weak demand for the yen. As we have already written, the regulator believes that tightening monetary policy in the current conditions can bring more harm than good to the economy. Moreover, the country has also joined the sanctions against Russia, which deprives its export-oriented companies of a serious share of income.

Against the backdrop of Russia's invasion of Ukraine, it is also noteworthy that a peace treaty between Russia and Japan was never concluded at the end of World War II, and the countries are still formally at war. The reason is the disagreement regarding the ownership of South Sakhalin and the Kuril Islands. And this issue has been raised again in recent days.

Weak statistics played against the yen last week as well. Japan's GDP fell from 1.3% to 1.1% in the Q4 2021 instead of growing to 1.4%. In annual terms, this figure fell from 5.4% to 4.6%, which disappointed investors.

As for the forecast, 80% of analysts believe that the pair's growth potential has already been exhausted, 20% adhere to the opposite point of view. There is almost complete unanimity among the indicators on D1, after such a powerful breakthrough to the north. 100% of trend indicators, as well as 90% of oscillators are looking up, although a third of them are already in the overbought zone. The remaining 10% of oscillators have taken a neutral position.

Experts name 117.35, 117.70, 118.00 and 118.60 as resistance levels. Supports are located at levels and zones 117.00, 116.75, 116.35, 115.75, 115.00, 114.40-114.65, 114.15, 113.75.

A regular meeting of the Bank of Japan will take place on Friday, March 18. But if the Bank of England has something to answer the US Federal Reserve, nothing of the kind can be expected from the Japanese regulator with its always negative (minus 0.1%) rate. The yen, as a safe-haven currency, is usually supported by investors running away from risky assets. However, judging by the events of the past week, they may give preference to the dollar.

CRYPTOCURRENCIES: March 09 Mystery and the Secret Struggle of Crypto Clans

Many were probably surprised by the unexpected jump in bitcoin on Wednesday March 09. The beginning of the week passed quite calmly: the bulls tried to break above $40,000, the bears tried to lower the quotes below $37,000. And then all of a sudden, in just a few hours, the BTC/USD pair soared by 10%, reaching a high of $42,520.

Why did it happen?

We have repeatedly said that the present and future of the crypto market is largely in the hands of the White House and the US central bank, and the jump on March 09 is an obvious proof of this.

Bitcoin and other digital assets surged after the details of President Joe Biden's executive order were revealed. The document instructs federal agencies to study the impact of cryptocurrencies on national security and the economy by the end of the year, as well as outline the necessary changes in legislation. In particular, it is supposed to coordinate the work of the SEC (Securities and Exchange Commission) and the CFTC (Commodity Futures Trading Commission), as well as the definition of roles for government agencies - from the State Department to the Department of Commerce.

According to a number of analysts, the events in Ukraine prompted the preparation of this document by the White House. More precisely, the fear that some organizations and individuals may use digital assets to circumvent sanctions against Russia. But, whatever the reason, it doesn't change the point. Unlike, for example, China, which seeks to completely destroy this market, the United States, on the contrary, seems to want to develop this industry. And this was positively received by crypto investors.

Such Washington's intentions were confirmed by Anthony Scaramucci, founder of SkyBridge Capital and former White House Communications Director. He is confident that the United States will not tighten the noose around the neck of the crypto market: ?I don?t think the US wants to lose its leadership in financial services. If they decide to ban or over-regulate digital currencies, we will see capital flight and brain flight out of the country.?|

This businessman also stated in an interview with Magnifi that investors should buy BTC even if they have never worked with cryptocurrencies before. According to Scaramucci, cold-blooded holders who know how to wait will benefit in the future. He is confident that bitcoin is guaranteed to reach $100,000 in a couple of years. Note that the entrepreneur stores about $1 billion in bitcoins at the moment.

Returning to the sanctions against Russia, they can cause the price of bitcoin to skyrocket, according to another billionaire, the legendary investor Bill Miller. ?Almost 50% of its reserves are held by Russia in currencies controlled by people who want to harm it,? Miller said. In this regard, the Russian government may try to use digital gold as a reserve currency. And this, according to Miller, is a ?very bullish signal? for bitcoin.

The bullish sentiment was also supported by an authoritative cryptanalyst known as Dave the Wave. According to his forecast, the price of the main cryptocurrency should update its historical maximum in 2022. Dave the Wave has published the BTC price chart and explained that despite bitcoin falling below $40,000, it is still on its way to $100,000. Against the background of the collapse of the global market, the coin has a chance for a steady rebound from the $36,000 mark.

The well-known crypto-analyst and trader Michael van de Poppe looks at the current situation quite differently. He believes that against the background of geopolitical tensions in the east of Europe, bitcoin can continue its fall to $30,000. "Why?" asks the specialist. And he answers: ?Because of a short-term panic. You should understand that traders are people who are focused on the short term, are very impulsive, emotional, and this is what the markets reflect.? At the same time, Michael van de Popp notes that the current recession is a good opportunity for those who are still optimistic about the first cryptocurrency to replenish its reserves.

As for the altcoins led by ethereum, according to the trader, they are under strong selling pressure in the current situation, which could push them further down until the ethereum reaches the $2,000 mark.

According to Galaxy Digital CEO Mike Novogratz, bitcoin and gold will become the safest assets in the near future. ?You can put an equal sign between these two instruments and stop the discussion about what is more important, BTC or precious metals,? this billionaire said.

However, there is no equality at the moment. On the contrary, according to analysts from IntoTheBlock, the correlation between bitcoin and precious metals has fallen to its lowest level since August 2021. Thus, it has reached a 7-month low in relation to gold and silver. Experts believe that these changes have occurred against the backdrop of a military operation that Russia is conducting on the territory of Ukraine. Bitcoin is highly correlated with the traditional stock market while commodity prices continue to rise.

According to experts, indicators that assess the return on an asset and the degree of risk demonstrate how much better precious metals have reacted to the resulting volatility compared to the flagship cryptocurrency.

The experts have also noted that the majority of bitcoin holders (57%) have not been affected by the recent price fluctuations of the coin. Many holders keep their virtual assets for more than a year, which means they still have positive returns.

At the time of writing this review (the evening of March 11), after the jump on March 09, everything is back to normal: the BTC/USD pair is trading around $39,000, the total market capitalization, after rising to $1.854 trillion, returned to the values of a week ago at $1.740 trillion, and the Crypto Fear & Greed Index fell from 27 to 22 points, finding itself in the Extreme Fear zone once again.

And in conclusion, another tip in our joke crypto life hacks column. Recall that we talk in it about alternative ways to make money in this market. This time our advice is: ?Try writing a crypto thriller.? An example is a bestseller that recently came out from the pen of Forbes journalist Laura Shin. Its title is very telling: The Cryptopians: Idealism, Greed, Lies, and the Making of the First Big Cryptocurrency Craze. The writer talks in this book about the large-scale struggle of the rich for influence and leadership in the ?new money? industry.

Shin introduces readers to prominent figures in the digital space, such as Vitalik Buterin, Web3 prodigy, Charles Hoskinson, and Joe Labin (a former Goldman Sachs vice president who became one of the most famous cryptocurrency billionaires). ?Sparks fly as these prominent personalities fight for their place in what seems to be a limitless new business world,? the author writes, describing the ?crypto clans? confrontation.


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
#108 - March 13, 2022, 02:10:42 PM

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Forex and Cryptocurrency Forecast for March 21 - 25, 2022


EUR/USD: Has the Market Gone Crazy?

What happened in the market after the US Federal Reserve meeting can be called "the theater of the absurd". As expected, the regulator raised the key interest rate from 0.25% to 0.5% on Wednesday, March 16, for the first time since 2018. As expected, the dollar began to strengthen after that. But what no one expected was that the strengthening will last only about an hour and will amount to some 50 points. After that, it will be not the American, but the European currency that will begin to grow. As a result, the EUR/USD pair will fix a weekly high at 1.1137 the next day.

Everything that happened was completely contrary to logic. The forecasts for US GDP were revised. And they showed that the Fed expects economic growth to slow down in 2022 from 4% to 2.8% due to the sanctions war with Russia. In addition, the forecasts for the interest rate have also changed. It was earlier said that it will reach 0.75-1.00% by the end of the year. This figure has now risen to 1.75-2.00%. Given that there are only six meetings left this year, it turns out that the FOMC (Federal Open Market Committee) will have to raise the rate by 0.25% at each of them.

But this is not all either. The forecast for the end of 2023 was also raised from 1.50-1.75% to 2.75-3.00%. Moreover, it seems that we will face several more acts of monetary restriction in 2024. That is, this is not just a revision of forecasts, but a sharp tightening of the US monetary policy, which could deal a serious blow to the labor market and lead to a large-scale recession.

In such a situation, the dollar would have to grow steadily, and the S&P500, Dow Jones and Nasdaq stock indices would fall drastically. But everything went the opposite way: the DXY Dollar Index fell drastically, and stock indices quickly flew up.

As already mentioned, there is no logical explanation for this. Some believe that the reason for this is the rate increase not by 0.5%, but only by 0.25%. According to another version, the reason is that the regulator has not clarified plans to reduce the Fed's balance sheet. And someone thinks that it is the greed factor that worked. Speculators remembered how quickly stock indices recovered after the shock at the beginning of the pandemic and decided that something similar would happen again soon. So now is the time to buy US stocks while they are still relatively cheap after a 10-week drop.

Logic began to return to the markets at the very end of the working week. The dollar began to rise again, and the EUR/USD turned south, finishing at 1.1050. As for its future, experts' opinions are divided as follows: 45% have supported the growth of the pair, 35% support the fall, and 20% have taken a neutral position. Among the oscillators on D1, the picture is mixed: 30% of them are colored red, 30% are green and the remaining 40% are neutral gray. The trend indicators have an advantage on the side of the red ones: those are 65% against 35% of the green ones.

The nearest target for the bears will be to break through support at 1.1000, then 1.0900. If successful, we can expect a retest of the March 07 low at 1.0805. This will be followed by the 2020 low of 1.0635 and the 2016 low of 1.0325. The strategic goal is parity at the level of 1.0000.

The bulls' immediate goal is to break through the resistance zone in the 1.1100-1.1135 area. Then there are zones 1.1280-1.1390 and the highs of January 13 and February 10 at 1.1485.

As for the upcoming week, there are few important macro data expected. Thursday, March 24, can be singled out in the economic calendar, when data on business activity in Germany and the Eurozone will arrive. The volume of orders for capital goods and durable goods in the US will be known on this day as well.

GBP/USD: Bank of England Is One Step Ahead of the Fed

Strange market reaction to the Fed meeting helped the pound as well. Positive statistics on the national labor market also sided with the British currency. The unemployment rate, with the forecast of 4.0%, actually fell from 4.1% to 3.9% in January, and the number of applications for unemployment benefits in February decreased by 48.1K (31.9K in the previous month). The average wage increased from 3.7% to 3.8%. Taking into account bonus payments, its growth amounted to 4.8%, which is also better than the forecast of 4.6%. All this allowed the Bank of England to once again be one step ahead of the US Federal Reserve and to raise the interest rate from 0.50% to 0.75% at its meeting on Thursday, March 17.

It is highly likely that the regulator of the United Kingdom will continue to tighten monetary policy and raise the refinancing rate again at its next meeting, in a month and a half. The new inflation forecast will also push it to this. Unlike its US and European counterparts, the Bank of England expects it to reach 7.25% in April. It will take at least two years to bring it down to the target level of 2.0% in such a situation.

The results of the meeting of the Bank of England initially caused the same paradoxical reaction of investors as in the case of the US Federal Reserve. The GBP/USD pair, instead of growing, fell from 1.3210 to 1.3087 on expectations of an active rate hike. However, then, as in the case of the euro, the market changed its mind, and the pair completed the five-day period at 1.3175.

Experts' forecast for the GBP/USD pair for the next week is as follows: 50% vote for the movement to the north, 40% are for further movement to the south, the remaining 10% vote for the sideways trend. Among the oscillators on D1, 70% are looking down, 30% have taken a neutral position at the time of writing the review. For trend indicators, 65% side with the bears, 35% side with the bulls.

The nearest support is located in the zone 1.3080-1.3100, then comes the low of the past week (and at the same time of 2021-2022) - 1.3000, followed by the 2020 support. Resistance levels are 1.3185-1.3210, then 1.3270-1.3325, 1.3400, 1.3485, 1.3600, 1.3640.

As for the events of the upcoming week, one can pay attention to the data from the UK consumer market, which will arrive on Wednesday March 23. The country's services PMI (Markit) will be released on the next day, Thursday, March 24, which is expected to rise from 60.5 to 60.7 over the month.

USD/JPY: Yen Falls to Six-Year Low

Daily Market Analysis from NordFX in Fundamental_cZNj4Qo

The headline of the previous USD/JPY review stated that ?the markets chose the dollar?. The past week has only confirmed this conclusion. Despite the fact that the US currency fell against the euro and the pound, it continued to grow steadily against the yen. The high of the week was fixed at 119.40, while the finish was slightly lower?, at the level of 119.15.  The last time the USD/JPY pair traded so high was a very, very long time ago, at the turn of 2016/2017.

The reason for this is the Bank of Japan, which does not want to change its ultra-soft monetary policy. The position of the Japanese regulator differs sharply from the position of the Fed, the Bank of England, and even the ECB. Although, admittedly, there are certain reasons for this. Inflation in the country amounted to only 0.9% in February in annual terms against 0.5% in January. This indicator, although it was the highest since April 2019, is simply insignificant compared to the inflation rate in the UK or in the US, where it reached 7.9%, the highest in the last 39 years.

And although, following the results of the last meeting on Friday, March 18, the Central Bank of Japan announced that it expected inflationary pressure to increase due to rising energy and commodity prices, it still kept the interest rate at a negative level, minus 0.1%, and the target yield of ten-year government bonds are close to zero.

As for the forecast, 70% of analysts believe that it is time for the pair to turn down, 20% hold the opposite view, and 10% have just shrugged. Among the indicators on D1, there is almost complete unanimity after such a powerful breakthrough to the north. 100% of trend indicators and oscillators are looking up, although 35% of the oscillators are already in the overbought zone.

The pair easily broke through all the resistance levels indicated a week ago, and one can most likely focus on the next round values with a backlash of plus/minus 15-20 points now. The nearest zone is 119.80-120.20. Supports are located at the levels and in the zones 119.00, 118.00-118.35, 117.70, 116.75, 115.80-116.15.

Of the week's macro statistics, inflation data in Tokyo, which will be released on Friday, March 25, is of interest. According to forecasts, the core consumer price index in the country's capital may fall from 0.5% to 0.4%. A report on the latest meeting of the Japanese regulator's Monetary Policy Committee will be published a day earlier. However, all its main decisions are already known, so one should hardly expect any surprises from this document.

CRYPTOCURRENCIES: The Salvation of Bitcoin Is in Small Holders

So, Jerome Powell's speech at the end of the Fed meeting has returned investor interest to the stock market, becoming the driver of the best two-day increase in the S&P500 index since April 2020. Both Dow Jones and Nasdaq went up. This is not to say that the increase in such risk appetites has helped cryptocurrencies a lot, but at least it has kept them from falling further. The BTC/USD bulls tried to gain a foothold above $40,000 once again, while their ETH/USD counterparts tried to push the pair closer to $3,000.

Bitcoin is trading in the $41,650 zone at the time of writing this review, on the evening of Friday March 18. The total market capitalization increased from $1.740 trillion to $1.880 trillion over the week. And the Crypto Fear & Greed Index remained in the Extreme Fear zone, having hardly risen from 22 to 25 points.

Probably, the growth of US stock indices can be considered good news for the digital market as well. Another piece of good news came from the other side of the Atlantic, from Europe. The Committee on Economic and Monetary Affairs of the European Parliament (ECON) has adopted a bill to regulate cryptocurrencies. ?It is a good day for the crypto sector! The EU Parliament has paved the way for innovative regulation of cryptocurrencies that can set standards for the whole world,? said one of the drafters of the law. It is also positive that the document has not included an amendment to ban mining on the Proof-of-Work consensus algorithm, which would de facto mean a ban on bitcoin.

The European Parliament's decision came just days after US President Joe Biden signed an executive order on the same subject. Recall that this document instructs federal agencies to study the impact of cryptocurrencies on national security and the economy by the end of the year, as well as outline the necessary changes in legislation. In particular, it is supposed to coordinate the work of the SEC (Securities and Exchange Commission) and the CFTC (Commodity Futures Trading Commission), as well as the definition of roles for government agencies - from the State Department to the Department of Commerce.

According to some analysts, the events in Ukraine prompted both the White House and the EU Parliament to take these steps. More precisely, the fear that some organizations and individuals may use digital assets to circumvent sanctions against Russia. And there is no doubt that such attempts are being made.

So, it became known last week that some large investors from Russia had been keeping their cryptocurrency reserves on Swiss exchanges, counting on the neutrality of this country. However, Switzerland announced unexpectedly that it was joining the European sanctions. And now the Russian oligarchs are trying to save their assets. For example, Reuters reports that a cryptocurrency company (the name is not published) received orders from Swiss brokers to sell 125,000 bitcoins, which are worth about $5 billion, and to convert them into cash.

Analytical company Elliptic said that it transfered to the US authorities information about digital wallets allegedly associated with sanctioned Russian officials and oligarchs, Bloomberg reports. To support the sanctions regime against Russia, Elliptic employees have identified more than 400 virtual asset service providers (mostly exchanges) where cryptocurrencies can be purchased for rubles (according to analysts, turnover on these platforms tripled in a week). In addition, the company's specialists have identified several hundred thousand crypto wallets associated with sanctioned individuals and legal entities.

According to some experts, it is possible that bitcoin will return to a bearish trend, against the backdrop of a tense geopolitical situation and the upcoming tightening of the Fed's monetary policy. AcheronInsights editor Christopher Yates expects BTC/USD to drop to $30,000. Well-known analyst Willy Woo shares similar fears. His calculations indicate that there is no necessary dip in the relative cost measurement. This, in his opinion, suggests that "there is room for another fall."

In addition to the growth of investors' risk appetite, bitcoin keeps the activity of small buyers with wallets up to 10 BTC from a collapse: they increase their purchases in the hope of a local bottom being formed. So, CoinMarketCap's SMM service has conducted a survey among subscribers, as a result of which 4 out of 5 users expressed confidence that the price of BTC will rise to almost $50,000 by the end of March.

According to analysts from IntoTheBlock, the number of holders of the flagship cryptocurrency has now reached a record high: 39.79 million unique addresses. About 888 thousand new BTC holders have joined the network since the beginning of this year. At the same time, according to Finbold, a serious growth is observed among small holders holding less than 1 BTC on their balance. As for the whales (from 1000 to 10,000 BTC), they have not increased their holdings much. According to the analysts, this suggests that bitcoin is unlikely to show serious growth in the medium term.

Apple co-founder Steve Wozniak is more optimistic about the prospects of the flagship cryptocurrency; he believes that bitcoin will still rise to $100,000. According to him, BTC is ?the most incredible mathematical miracle? that surpasses gold due to the confirmed digital scarcity.

Other influencers in the crypto world believe that the coin can reach this milestone as well. Bitbull CEO Joe DiPasquale is one of the biggest proponents of cryptocurrency. Even though bitcoin has been falling since November, he believes that the digital asset is still on track to reach the long-awaited $100,000 mark.

Galaxy Digital CEO Mike Novogratz named five times the figure during his speech at Bloomberg TV. He once again confirmed his forecast, according to which the largest cryptocurrency could rise to $500,000 in five years. And it will be a smooth, not aggressive growth.

The billionaire had accurately predicted that the cryptocurrency market would stall at the beginning of 2022. According to him, bitcoin?s upward rally in 2021 was fueled by fears that the Federal Reserve would ?print money forever. Now that the Fed is winding down its stimulus program, the largest cryptocurrency is in the middle of a bearish trend.

The CEO of the crypto-bank Abra Bill Barhydt draws no less brilliant prospects for the ethereum. He believes that a steady decrease in fees within the ethereum network can serve as a driver for the growth of the asset to the $30,000-40,000 zone. Today, the ethereum network is one of the most sought after in the industry, as it is used in the field of non-fungible tokens (NFT), DeFi decentralized finance, games, etc. The number of ethereum holders will only grow with the launch of Ethereum 2.0 and the launch of staking approaching.

However, Bill Barhydt has not ruled out the possibility of selling small amounts of ETH in June or July. According to him, this will be a completely predictable correction against the backdrop of the growth of cryptocurrency.


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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#109 - March 20, 2022, 05:09:18 PM

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Forex and Cryptocurrencies Forecast for March 28 - April 01, 2022


EUR/USD: A Tangle of Chaos and Paradoxes

Daily Market Analysis from NordFX in Fundamental_yz0xMWy

The title of the previous EUR/USD review had a question of whether the market has gone crazy. Many analysts agreed that financial markets behaved at least illogically following the March Fed meeting. And at most, it's just absurd.

Despite aggressive tightening of monetary policy by the US regulator, despite a possible slowdown in economic growth in the US due to the actions of the Fed and anti-Russian sanctions, despite the worsening epidemiological situation in China, stock indices are going up. This is especially noticeable in the S&P500, which has added almost 10% since March 15, and it has more than doubled in the two years since the start of the COVID-19 pandemic (more precisely, it has gone up by 108%).

It is difficult to explain what is happening. The classic explanation that sounds most logical is that markets rise on expectations. Investors remembered how quickly stock indices recovered after the shock at the beginning of the pandemic and decided that something similar would happen again soon. That is, now is the time to buy shares before their price has flown to new heights.

As for EUR/USD, this pair behaved illogically as well. Markets were waiting for the difference in the monetary policies of the Fed and the ECB to push it sharply down. However, instead, the pair consolidated in the 1.1000 area, which fully confirmed the neutral forecast of experts and indicators given a week ago.

Apparently, investors believe that a sharp increase in interest rates by the Fed, although it will stop inflation, could create serious problems for the US industry. But Europe may expect good economic growth in Q3 and Q4.

US President Joe Biden said before his visit to the EU last week that he wanted to achieve new sanctions against Russia, including a complete embargo on Russian energy supplies. However, this did not happen, which supported the common European currency. The end of the armed conflict in Ukraine, or at least its transition from a hot phase to a frozen state, can further strengthen the euro. The situation on the debt market, which is much better in Germany, the locomotive of the European economy, than in the United States, also keeps the EUR/USD pair from falling.

At the same time, macro statistics look quite contradictory, introducing additional confusion into the assessment of the current situation. Thus, business activity in the eurozone slowed down from 55.5 to 54.5 this month. But it is still better than the forecast of 53.7 points. And in the US, the composite index of business activity jumped from 55.9 to 58.5 against the forecast of 55.4 points. And this is another paradox: how can this happen when anti-Russian sanctions are putting pressure on the economy on both sides of the Atlantic, and fuel prices are skyrocketing?

Even more confusion and chaos was added by President Putin's decision to sell energy resources for rubles. True, this only applies to countries that are unfriendly to him, but this list includes the United States and all EU countries, as well as Great Britain, Japan, Australia, New Zealand, Canada and Switzerland.

The UN Conference on Trade and Development has already lowered its forecast for US GDP for 2022 from 3.0% to 2.4%. There was also an adjustment for the GDP of the Eurozone, and it turned out to be more significant: the figure was halved, to 1.7%. This seems to be due to the EU's geographic proximity to war-torn Ukraine, as well as Europe's much greater dependence on Russian oil and gas. And now nobody knows how to buy them for rubles. There has never been anything like it in world practice. Therefore, most likely, purchases will take place through intermediary countries, for example, from North Africa or the Middle East, which will lead to another increase in prices.

The EUR/USD pair relied on support at 1.0960-1.0965 throughout the past week and ended the trading session at 1.0982. Most analysts (60%) believe that the pair will try to break through the support in the 1.0900 zone and retest the March 07 low at 1.0805. Then, with luck, the 2020 low of 1.0635 and the 2016 low of 1.0325 will follow. The strategic goal is parity at the level of 1.0000. The remaining 40% of experts have opposed such a scenario and vote for a bullish forecast. The nearest target for them is a breakdown of the resistance zone around 1.1050. Then there are zones 1.1100-1.1135, 1.1280-1.1350 and the highs of January 13 and February 10 in the area of 1.1485. At the same time, if we switch from the weekly to the median forecast for the whole of April, then the Pivot Point of the month is in the region of 1.1000, as it is now.

Among the oscillators on D1, the picture is mixed: 35% of them are colored red, 30% are green and the remaining 35% are gray neutral. Trend indicators have 100% on the red side.

The coming week will bring many important economic statistics. The value of the harmonized consumer price index in Germany will become known on Wednesday, March 30, and the volume of retail sales in this country on the next day. Statistics on consumer prices in general for the Eurozone will be published on Friday, April 01. In addition to European statistics, data on employment in the private sector and US GDP will be released on Wednesday, March 30, and in addition to data on business activity (ISM), we are traditionally waiting for a portion of statistics from the US labor market on Friday, including the number of new jobs created outside the agricultural sector (NFP).

GBP/USD: Narrow Channel Amid Uncertainty

As with the euro, GBP/USD bulls and bears are at a complete loss. The reasons are the same: a strange increase in the global risk appetite of investors and the unpredictable situation with energy resources. As a result, the pair has been moving east all week, trapped in a narrow corridor 1.3120-1.3220. The attempt of the bulls to break through in the middle of the five-day period above the horizon of 1.3300 ended in a fiasco, and the pair finished in the center of the named corridor, at the level of 1.3180.

Experts' forecast for the GBP/USD pair for the coming week is as follows: 50% vote for moving north, 25% vote for moving south, the remaining 25% vote for a sideways trend. Among the oscillators on D1 at the time of writing, 70% are looking up, 30% are looking down. For trend indicators, the opposite is true: 80% side with the bears, 20% - with the bulls.

The nearest support is located in the area of 1.3150, then there is a zone of 1.3080-1.3100 and the March 15 (and at the same time 2021-2022) low of 1.3000, followed by the support of 2020. Resistance levels are 1.329-1.3215, then 1.3270-1.3325, 1.3400, 1.3485, 1.3600, 1.3640.

From the events related to the economy of the United Kingdom, we can highlight the speech of the Governor of the Bank of England Andrew Bailey on Monday, March 28, as well as the publication of UK GDP data for the Q4 2022 on Thursday March 31.

USD/JPY: New Anti-Record of the Japanese Currency

The yen fell to a six-year low last week, reaching 119.15 JPY per 1 USD. The record was updated this week: the pair was marked at the level of 122.43 on Friday, March 25.

The Bank of Japan, which does not want to change its ultra-soft monetary policy, is to blame for such a sharp weakening of the yen. The position of the Japanese regulator contrasts sharply with the plans and actions of the Fed, the Bank of England and even the ECB. It still believes that a premature withdrawal of stimulus policies could do more harm than good. Admittedly, there are certain reasons for this. Inflation in the country amounted to only 0.9% in February in annual terms against 0.5% in January. This indicator, although it was the highest since April 2019, is simply insignificant compared to the inflation rate in the UK or in the US, where it reached 7.9%, the highest in the last 39 years.

This dovish position was once again confirmed during the speech of the head of the Bank of Japan Haruhiko Kuroda on March 22, who said that it was too early to discuss the possibility of curtailing the quantitative easing (QE) program, as well as raising the interest rate. Recall that it has been at a negative level for a long time - minus 0.1%.

Three other factors also pushed the yen down and USD/JPY up. The first one is the departure of investors from quiet currency havens to risky assets. The second factor is the Fed Chairman's rhetoric that has become even more hawkish. Speaking on March 21 at the US National Association of Economics and Business, Jerome Powell said that the US Central bank is ready to act even more aggressively if necessary. These words led the markets to think that the Fed could raise interest rates 10-11 times by the end of 2023. Based on such expectations, the yield on 10-year US government bonds rose from 2.146% to 2.282%, reaching a maximum since May 2019. And as we know, the exchange rate of the Japanese currency traditionally correlates with these securities. If the yield on ten-year Treasury bills grows, so does the USD/JPY pair. Which is what we saw last week.

And finally, the third factor is the decision of the Russian leadership to introduce payments for gas in rubles. ?We do not quite understand what Russia's intentions are and how it will do it,? Finance Minister Shun'ichi Suzuki said at a meeting of the Japanese Parliament on March 23.

Most analysts have been waiting for the end of the bullish rally for the past two weeks, but it still has not happened. On the contrary, the pair USD/JPY has added about 700 points. And now this "majority" of 70-80% has "shrunken" to 50%. Moving from a weekly to a monthly forecast, the number of those voting for the pair's reversal to the south and its fall at least to 117.00-118.00 is still large and amounts to 85%.

Among the indicators on D1, there is complete unanimity after such a powerful breakthrough to the north. 100% of trend indicators and oscillators are looking up, although 35% of the oscillators are already in the overbought zone.

The previous bullish forecast called the 119.80-120.20 zone as the target, which is now far below. It is difficult to point to any new targets in the current situation. Most likely, it is worth focusing on subsequent round levels with a backlash of plus/minus 15-20 points. This approach was confirmed last week, when the pair finished at 122.08. The range of support zones has also become wider due to very strong volatility. These are the zones 120.60-121.40, 119.00-119.40, 118.00-118.35.

The economic calendar of the week can mark Friday, April 1, when the Bank of Japan publishes the Tankan Large Producers Index. This is quite an important indicator that reflects the general business conditions for export-oriented large industrial companies in the country.

CRYPTOCURRENCIES: In Anticipation of a Bull Rally

Investors' risk appetites, which caused the growth of stock indices, have dragged the crypto market along with them. Bitcoin reached the powerful resistance level of $45,000 on the evening of Friday, March 25, for the fifth time since the beginning of the year. it is still an open question whether it will be able to gain a foothold above this level. The previous four attempts failed; the BTC/USD pair rolled back down. However, the rising wedge is clearly visible on its chart, in which each next drawdown becomes smaller and smaller. So the main cryptocurrency fell to $32.945 on January 24, to $34.415 a month later, and it hit the bottom at $37.170 on March 7.

The total market capitalization rose to $2.280 trillion at the peak on March 25, but it also failed to gain a foothold above this significant mark, and at the time of writing the review it is trading at $1.995 trillion ($1.880 trillion a week ago). The Crypto Fear & Greed Index finally moved out of the Extreme Fear zone to the middle of the scale, rising from 25 to 47 points.

Ethereum creator Vitalik Buterin condemned Russia's invasion of Ukraine in an interview with Time. At the same time, in his opinion, this event reminded the crypto community that the purpose of digital assets is to bring real benefits to people, and cryptocurrencies can become a counterbalance to authoritarian governments and undermine the ?suffocating control? of technology giants.

Arthur Hayes, co-founder of the BitMEX cryptocurrency exchange, agrees with Buterin, he believes that due to anti-Russian sanctions, bitcoin will gain an advantage over the US dollar, and possibly gold. In his opinion, sanctions against Russia and other countries only encourage their citizens to invest in gold and bitcoin, and not to keep money in dollars. Hayes explained that in a difficult economic situation, citizens have more confidence in assets with a limited supply or offer, considering them a more reliable way to save money.

The BitMEX co-founder believes that Russia's disconnection from the SWIFT international payment system, that is, the isolation of one of the energy leaders, may have long-term negative consequences for the global financial system. Gold will become the dominant asset for some time, as it will be used for international trade in energy and food products. After some time, Central banks will begin to save this precious metal, it will become increasingly difficult for them to make such payments. And this will contribute to the widespread introduction of digital currencies.

Cryptocurrencies need a clear regulation to become really popular. This is the opinion of Matt Hougan, investment director at Bitwise Asset Management. He believes that the current stage in the history of the digital industry is paving the way for growth that will occur this year and will continue next year.

One of the important regulatory steps, according to the top manager of Bitwise, is the recent decree of US President Joe Biden, which could lead to an increase in the price of bitcoin. Recall that this document instructs federal agencies to study the impact of cryptocurrencies on national security and the economy by the end of the year, as well as outline the necessary changes in legislation. In particular, it is supposed to coordinate the work of the SEC (Securities and Exchange Commission) and the CFTC (Commodity Futures Trading Commission), as well as the definition of roles for government agencies - from the State Department to the Department of Commerce.

Bank of America crypto strategist Alkesh Shah also believes regulation of the crypto market will increase confidence and capitalization to a record high. ?Ultimately we need some governance and some level of trust, but regulators want to ban when something goes wrong,? the expert explained. Therefore, in his opinion, a semi-decentralized system is optimal: blockchains, which are secretly managed by centralized organizations. ?I think that $30 trillion for the semi-decentralized part of the cryptocurrency ecosystem is quite real capital,? Shah concluded.

If we talk about the foreseeable future, the analytical company Glassnode expects a repeat of the bitcoin high of $69,000. The coin has been trading below the 200-day Simple Moving Average (SMA) For the past 9 weeks but continues to rise. A similar situation was observed during the accumulation period of 2021, which paved the way for a rally in the fourth quarter, when an all-time high was reached. Glassnode data also shows that long-term holders are still hoarding bitcoin and the number of bitcoins on exchanges is declining. The company's specialists interpret this data as the end of the downward correction period.

According to some experts, ethereum is now even slightly better off than bitcoin, as many investors are now buying ETH for BTC. In addition, the community is waiting for the long-awaited update to the ethereum mainnet. The Merge update is approaching rollout following successful testing on the testnet. Before its launch, more than $5.0 billion in ETH tokens had already been withdrawn from circulation as a result of burning. As burning reduces the total supply of ethereum, this can positively affect its price, contributing to the rally of the altcoin.

Analysts at FXStreet suggest that its price could rise by 20% in the current uptrend. But for this to happen, the ETH/USD pair needs to gain a firm foothold above $3,033, which could lead to a perfect bullish breakout for the first time since October 2021.


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
#110 - March 27, 2022, 12:43:35 PM

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Forex and Cryptocurrencies Forecast for April 04 - 08, 2022


EUR/USD: Too Much Uncertainty

The movement of major currencies was determined throughout March by reports from the Russian-Ukrainian front, the sanctions-energy war with Russia, and the pace of monetary tightening. The US dollar has strengthened significantly in recent months thanks to a sharp increase in the yield of US government bonds and signals about an increase in the Fed's interest rate. The EUR/USD pair fell to 1.0805 on March 07, its lowest level since mid-May 2020. However, then the growth of the dollar stopped, and the pair moved to a sideways movement along the Pivot Point 1.1000. The hawkish statements of the Fed management pushed the pair down, the hopes for resolving the armed conflict between Russia and Ukraine sent it above this line.

The same factors determined the dynamics of EUR/USD last week as well. The pair rose by 240 points from Monday, March 28 to Thursday, March 31: from 1.0944 to 1.1184. First, the strengthening of the euro was caused by reports in the US media that the ECB may start actively raising the refinancing rate this year. Allegedly, a number of large market participants require the European regulator to raise the rate four times by the end of 2022. As a result, investors began to include in quotes the probability of such a move by the ECB, and the yield on government bonds in Europe went up.

The next day, March 29, hopes dawned for the success of the peace talks between Russia and Ukraine, which took place in Istanbul (Turkey). The success of the EU's energy war with Russia also helped the European currency. Russian President Vladimir Putin signed a decree on the sale of energy carriers to Europe exclusively for rubles a week ago. The goal was clear: to support the ruble exchange rate under the sanctions. However, the main European consumers refused to do so categorically, and the head of Russia was forced to note his decision.

Everything would have been good for the euro, but it turned out in the second half of the week that the rumors about the increase in the EUR rate in 2022 are nothing more than a speculation, and that there was no serious shift in the negotiations in Istanbul. Macroeconomic statistics also helped the dollar a little. As a result, the growth of the EUR/USD pair stopped, it turned south and ended the five-day period not far from Pivot Point 1.1000, at the level of 1.1045.

The outcome of the hostilities in Ukraine is still unclear. The situation with the supply and payment of hydrocarbon raw materials to Europe remains confusing as well. Oil has fallen in price by about 14% since March 24. This is how the market reacted to the plans of President Joe Biden to sell additional volumes of oil from national reserves. The White House intends to sell up to 1 million barrels of oil per day over the next six months. And this could be the biggest sell-off in the nearly 50-year history of the US Strategic Petroleum Reserve. It should be noted here that, despite the smaller volumes, the sale of oil brings Russia more profit than gas currently. And such a decision by the United States should reduce Europe's dependence on Russian energy carriers, causing additional damage to the Russian economy.

Another uncertainty is introduced by the Fed. Recall that forecasts for US GDP have been recently revised. And they have shown that the regulator expects economic growth to slow down in 2022 from 4% to 2.8% due to the sanctions war with Russia. In addition, the forecasts for the interest rate have also changed. It was earlier said that it will reach 0.75-1.00% by the end of the year. This figure has now risen to 1.75-2.00%. Given that there are only six meetings left this year, it turns out that the FOMC (Federal Open Market Committee) will have to raise the rate by 0.25% at each of them.

But this is not all either. The forecast on the rate for the end of 2023 has also been raised from 1.50-1.75% to 2.75-3.00%. Moreover, it seems that we will face several more acts of monetary restriction in 2024. That is, this is not just a revision of forecasts, but a sharp tightening of the US monetary policy, which could deal a serious blow to the labor market and lead to a large-scale recession. The market may receive important signals about the future movement of the dollar on Wednesday, April 6. The minutes of the March FOMC meeting will be published on this day.

At the moment, 50% of analysts vote for the strengthening of the dollar. 40% vote for the growth of the EUR/USD pair and 10% have taken a neutral position. Among the oscillators on D1, the picture is mixed: 30% of them are colored red, 20% are green and the remaining 35% are gray neutral. The trend indicators have an advantage on the side of the red ones: those are 85% against 15% of the green ones.

The nearest target for the bulls is a breakdown of the resistance zone in the area of 1.1100-1.1135, followed by the zones of 1.1185-1.1200, 1.1280-1.1350 and highs on January 13 and February 10 in the area of 1.1485. As for the bears, they will certainly try to break through the support of 1.0950-1.1000 and drop 100 points lower. If successful, the next targets will be the March 07 low at 1.0805 and the 2020 low at 1.0635 and the 2016 low at 1.0325.

Apart from the publication of the minutes of the March FOMC meeting, there will be relatively few events in the coming week. We can highlight the publication of the ISM PMI in the US services sector on Tuesday, April 05, as well as data on retail sales in the Eurozone on Thursday, April 07.

GBP/USD: Trend east, along 1.3100

Statistics from the United Kingdom last week turned out to be rather contradictory. According to the data published on Thursday, March 31, the British economy for the Q4 21 grew by 1.3%, which was higher than both the previous 1.0% and the forecast of 1.0%.  The economy grew by 7.5% over the past year, which was the highest since 1941. But it is necessary to take into account  here that  GDP fell by 9.4% in 2020. So, there has not yet been a final recovery to the pre-pandemic level. In addition, data on the country's current account for the Q4 21 amounted to 7.3 billion pounds against the forecast of 17.6 billion and the previous value of 28.9 billion.

The activity of the manufacturing sector in the UK was also less than expected, which was confirmed by a IHS Markit report on Friday, April 01. The Purchasing Managers' Index (PMI) was 55.2 in March against the forecast of 55.5.

As with the euro and for the same reasons, GBP/USD investors and traders are at a loss. As a result, the pair was moving east along the 1.3100 level in a narrow corridor throughout the week. The low of the week was fixed at 1.3050, the high was 1.3182, the last chord sounded at 1.3112.

Giving a forecast for the coming week, 55% of experts side with the bulls, 35% support the bears and 10% remain neutral. The median forecast still points to the 1.3100 horizon. True, when moving to the forecast for the whole of April, its value rises to the zone of 1.3235. Most trend indicators on D1 point north. Among the oscillators, 55% are colored red, 20% are green and the remaining 25% are gray neutral. Trend indicators, as in the case of EUR/USD, have an overwhelming advantage on the side of the red ones: those are 90%.

The nearest support is located in the area of 1.3080-1.3100, then 1.3050 and the low of March 15 (and at the same time of 2021-2022) - 1.3000, followed by the support of 2020. Resistance levels are 1.3160, 1.3190-1.3215, then 1.3270-1.3325, 1.3400, 1.3485, 1.3600, 1.3640.

Among the events related to the economy of the United Kingdom, we can highlight the speech of the Governor of the Bank of England Andrew Bailey on Monday, April 4, as well as the publication of the Composite PMI and the Business Index UK services activity on Tuesday, April 05, and the Construction PMI on Wednesday, April 06.

USD/JPY: 125.09: No More Anti-Records?

The yen breaks an anti-record after an anti-record. The USD/JPY hit 122.43 on Friday, March 25, and it was already 263 points higher at 125.09 on Monday, March 28. The reason for the continued weakening of the Japanese currency is the same: the Bank of Japan, which does not want to change its super-soft monetary policy. Its head, Haruhiko Kuroda, once again stated on March 22 that it was too early to discuss the possibility of curtailing the quantitative easing (QE) program, as well as raising the interest rate. Recall that it has been at a negative level for a long time, minus 0.1%. In addition, the regulator was actively buying Japanese government bonds (JGB) throughout the past week in a desperate attempt to prevent their yield from breaking through the target level of 0.25%.

Last week's high of 125.09 is already close to the 2015 high of 125.86. And if the pair manages to break higher, then, according to strategists at Credit Suisse, this will open the way for it to 135.20 in the long term, and then even higher, to the zone of 147.00-153.00. However, in their opinion, the correction that has begun now can be continued during the Q2, first to 119.79, then to 119.09, after which the pair will move to trading in the range of 119.00-125.00. Credit Suisse also believes that if the pair breaks through support at 119.09, then the pullback may become deeper, to the zone of 116.35-116.50.

The same high for the Q2 is called by Rabobank specialists, who predict the pair's rise above 125.00 only in the second half of this year. They believe that the tightening of the Fed's policy is already built into the current dollar quotes, and this will hold back the growth of the pair in the coming months. However, the difference in interest rates and Japan's position as an importer of raw materials will play their role in Q3 and Q4, and the yen will continue to gradually weaken. A quick jump in USD/JPY above 125.00 will seriously increase the likelihood that the Bank of Japan will revise its quantitative easing (QE) program.

As for the past week, after the pair rose to 125.09, a correction began. The low was recorded on Thursday, March 31 at 121.27, after which the pair went up again and finished at 122.54.

With 50% of experts giving a bullish outlook for the coming week, it looks very moderate and sees the pair rising to the 124.00-124.50 zone as a target. 25% of analysts, on the contrary, vote for a further decline in the pair, and 25% have taken a neutral position. It should be noted that when switching to a monthly forecast, the vast majority (85%) of experts predict the strengthening of the Japanese currency and expect to see the pair in the 115.00-117.00 zone.

Among the indicators on D1, there is almost complete unanimity after such a powerful breakthrough to the north. 90% of trend indicators and 100% of oscillators are looking up, although 25% of the oscillators are already in the overbought zone. The nearest resistance levels are 123.20, 124.20 and the March 28 high at 125.09. After that, as already mentioned, the bulls may try to reach the 2015 high at 125.86. The nearest support is 122.00, then 121.30. It is followed by zones 120.60-121.40, 119.00-119.40, 118.00-118.35.

There are no expected releases of any important statistics on the state of the Japanese economy this week.

CRYPTOCURRENCIES: What Whales and Short-Term Speculators Do

Daily Market Analysis from NordFX in Fundamental_7njEWr7

Investors' risk appetite, which caused the growth of stock indices, continued to pull the crypto market with it at the beginning of last week. Bitcoin gained 28% and ethereum gained nearly 40% in just the second half of March.

The main cryptocurrency reached the powerful resistance level of $45,000 on the evening of Friday, March 25, for the fifth time since the beginning of the year. It failed to gain a foothold above it the previous four times, the BTC/USD pair rolled back down. This time it seemed that the bulls finally achieved the long-awaited victory: the quotes recorded a local high at a height of $48.156 on March 28. However, after that, the pair hit the 200-day SMA and stopped rising. The most logical explanation for this stop is the strengthening of the dollar at the end of the past week.

At the time of writing, April 01, the flagship cryptocurrency first returned to the $45,000 zone, which turned from resistance to support, and then rebounded to $46,500. The total market capitalization rose to $2.140 trillion ($1.995 trillion a week ago). The Crypto Fear & Greed Index has also grown slightly: from 47 to 50 points.

DataDash CEO Nicholas Merten believes that short-term investors and traders with leverage influence bitcoin volatility, and ?whales? influence the growth. ?There has been a lot of panic around the macro environment over the past couple of months,? Merten writes. The Fed is raising interest rates... The war between Ukraine and Russia, the potential next wave of COVID-19 - all these problems caused pessimism among small investors. At the same time, the ?whales?, on the contrary, did not sell cryptocurrency... In fact, we saw how long-term investors continued to either buy more or hold bitcoin.

One such investor was the well-known software developer MicroStrategy. The company has recently received a $205 million loan secured by its own crypto assets. The loan was issued by the American bank Silvergate. The purpose of the loan is to buy bitcoins. According to the Bitcoin Treasuries website, MicroStrategy already owns 125,051 BTC worth nearly $6 billion. And ?this loan,? said Michael Saylor, CEO of MicroStrategy, ?is an opportunity to strengthen our position as a leader among public companies investing in bitcoin.?

Note that MicroStrategy is not the only company that provides crypto assets as collateral. For this type of loans, Silvergate Bank has a special SEN Leverage program, the total amount of obligations for which has already exceeded $570 million.

Despite numerous macroeconomic and geopolitical challenges, bitcoin is highly likely to enter the second half of a bear market, according to analysts at Glassnode. This is evidenced by the active accumulation of coins in the range of $35,000-42,000 and the absence of significant spending of bitcoins purchased in the Q1 2021. The share of BTC ?aged? over a year has grown by 9.4% over the past eight months to close to a record 62.9%. The holders of these coins did not get rid of the asset in the face of two corrections of more than 50% in the last 12 months. The growth rate of this indicator is comparable to the market recovery in 2018-2019. And this may reflect increased investor confidence in bitcoin.

At the same time, analysts at Glassnode warn that the process of bottoming and investor capitulation in a bear market is often lengthy and painful. Therefore, they urge not to rush into ascertaining the end of the bear market.

A number of experts believe that a new strong correction to the south is only a matter of time. There are still no drivers for the rapid growth of quotations, and everything depends on the severity of the geopolitical situation and the dynamics of the global economic recovery. The $30,000 level may become the bearish target for the BTC/USD pair.

Peter Brandt, CEO of Factor Trading, calls for caution in optimistic forecasts. This legendary trader tweeted to his 629,400 followers that BTC?s recent move reminded him of April 2019 when the top cryptocurrency bottomed at $3,500, starting the first phase of its bull cycle. However, the expert emphasizes that even a technical breakthrough does not guarantee that the coin will repeat the 2019 rally.

?Charts DO NOT predict the future. The charts DO NOT even offer probabilities. Charts offer opportunities and are useful for risk management in a trading program. Chart patterns can either work, fail, or transform. If laser eyes reappear and BTC stops, be careful,? Brandt warns.

Crypto analyst alias Dave the Wave posted a comment saying that bitcoin is forming a larger ascending triangle on the weekly timeframe and could rise to its all-time high of $69,000.

We noted in the forecast for the last week of March that the position of ethereum is currently slightly better than that of bitcoin. The above growth figures are clear proof of this. Many investors are now buying ETH with BTC. In addition, the community is waiting for the long-awaited update to the ethereum mainnet. The Merge update is approaching rollout following successful testing on the testnet. Before its launch, more than $5.0 billion in ETH tokens had already been withdrawn from circulation as a result of burning. Since the burning reduces the overall supply of ethereum, this positively affects its price, contributing to the altcoin?s rally. Glassnode analysts have found that the volume of ethereum on exchanges has been declining in recent days. The inflow of this altcoin to the trading floors is 20% lower than its outflow, which creates the conditions for the formation of an ETH deficit.

The growth in the value of the coin is observed against the backdrop of the activation of the ten largest ETH addresses. Whales have accumulated up to 23.7% of the total ethereum supply, according to a new report from analytics firm Santiment. And they are not going to dump their assets, preferring to send ETH to offline storage. A similar trend was observed in the first half of 2017, after which we saw the famous altcoin run during the hype five years ago.

And at the end of the review, another piece of advice in our crypto life hacks section. Recall that we talk in it about the most interesting and unexpected ways to make money in this market.

Have you ever wondered what the toilet is for? We will tell you: to mine cryptocurrency! This is exactly what Gabriel Kozak and Du?an Matuska from Slovakia decided. As a result, they created the AmityAge mining farm, which runs on electricity obtained from human and animal waste. Du?an Matushka, said that "their devices run on methane, which is produced during the biodegradation process." Since there is no shortage of such waste in the foreseeable future, BTC mining on their farm is not dependent on rising global energy prices. Moreover, it takes place in an environmentally friendly way using renewable energy sources, which completely removes all claims against this industry.


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
#111 - April 03, 2022, 08:45:27 AM

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March 2022 Results: Three Most Successful NordFX Traders Earned Over 215,000 USD

Daily Market Analysis from NordFX in Fundamental_kQlPPWL

NordFX Brokerage company has summed up the performance of its clients' trade transactions in March 2022. The services of social trading, PAMM and CopyTrading, as well as the profit received by the company's IB-partners have also been assessed.

Representatives of Central and South-East Asia took all three steps of the podium in March.
- The highest monthly profit, 128,026 USD, was received by a client, account No.1620XXX, mainly on transactions with gold (XAU/USD). It should be noted that this trader is not new to our rating. So, they occupied second place with a score of 22.046 USD in February.
- This time, the second step has been taken by the owner of account No.1403XXX, who earned 70,910 USD on transactions on BTC/USD, XAU/USD and USD/CAD pairs.
- And, finally, the third place is occupied by a trader, account No.1594XXX, with a profit of 17,791 USD, whose main trading instrument is gold (XAU/USD).

The situation in NordFX passive investment services is as follows:
- CopyTrading still has an active provider under the nickname KennyFxPro. Signal with the complex name KennyFXPRO - Journey of $205 to $5,000 has shown a profit of 225% since March 2021 with a maximum drawdown of 67%. They increased their capital by almost 31% in March alone. As before, almost all trades were made with NZD/CAD, AUD/CAD and AUD/NZD pairs. Such a famous pair as EUR/USD took only 0.21% in their arsenal. Another signal from the same supplier, KennyFXPRO-Prismo 2K, is two months younger than the first one, the profit on it is less - 112%, but the drawdown has also been lower - about 45%.
- The leaders in the PAMM service have not changed over the past month either. Here we mark the manager under the nickname KennyFXPRO once again. True, the aggressiveness of their trading on the PAMM account is much lower than in CopyTrading. They increased their capital on the KennyFXPro-the Multi 3000 EA account by 92% in 432 days with a fairly moderate drawdown of less than 21%. TranquilityFX-The Genesis v3 account, which showed a 67% profit in 330 days with a similar maximum drawdown of less than 21%, and NKFX-Ninja 136, which has generated 54% income since June 11, 2021, with the same drawdown of about 21%, are also among the leaders. The EUR/USD pair is still invisible among trading instruments. The vast majority of transactions were made with NZD/CAD, AUD/CAD and AUD/NZD. It should also be noted that the maximum drawdown showed a slight increase in March: it increased by about 5% for all three listed accounts.

Among the IB partners of NordFX, the TOP-3 also includes representatives of Central and Southeast Asia:
- the largest commission, 8.952 USD, was accrued to the partner with account No.1336XXX, who moved from third place to first in a month and now leads the rating;
- the next is the partner (account No.1229ХХХ), who received 3,881 USD;
- and, finally, the partner with account No. 1336xxx, who received 5,789 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
#112 - April 04, 2022, 10:15:59 AM

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Forex and Cryptocurrencies Forecast for April 11 - 15, 2022


EUR/USD: Three reasons for the Strengthening of the Dollar

The proponents of a stronger dollar won by a very small margin in the previous forecast. 50% of analysts voted for its growth, 40% were against and 10% took a neutral position. The reason for such uncertainty and disagreement was that the market seemed to have already taken into account the increase in the dollar interest rate in 2022 for the quotes. However, despite this, the US currency has continued its growth. The DXY index has gained about 2% over the last week, and the EUR/USD pair, as predicted by bearish supporters, has broken through the support in the 1.0950-1.1000 zone and is aiming at the March 07 low of 1.0805. True, it has not yet managed to reach it, and the pair finished at 1.0874.

So why is the dollar continuing to gain strength? There are three reasons for this. The first is the Fed's monetary policy, which is becoming increasingly tight. We are now talking about reducing the balance sheet, which the US regulator intends to reduce by more than $1 trillion a year. And this is equivalent to an additional 3-4 increases in the refinancing rate in 2022-23, 25 basis points each. US Treasury yields will also rise, making the dollar more attractive.

The second and third causes are located on the other side of the Atlantic, in Europe. These are the presidential elections in France and new sanctions against Russia because of the armed conflict in Ukraine.

The first round of elections will be held on Sunday 10 April. French opposition leader Marine Le Pen is Eurosceptic. Please note that she almost called for the exit of the country from the Eurozone in 2017. And even if the opposition loses the election, it will still put a spoke in the wheels of European integration. But if Marine Le Pen comes to power, the pan-European currency will certainly not do well. According to some analysts, the EUR/USD pair may fall to the level of 1.0500 or even lower.

As for sanctions, we have repeatedly said that they negatively affect not only the Russian economy, but also the EU. First of all, because of the strong dependence of the European Union on Russian energy resources. In addition, one can add here the risks of Russia using nuclear weapons and the fact that military operations could turn into a catastrophe many times greater than Chernobyl.

The most important event of the coming week will be the ECB meeting and the subsequent press conference of its leadership on Thursday April 14. The probability that the interest rate will remain at the previous zero level is very high. However, investors hope to receive signals on how the European regulator plans to respond to internal and external challenges.

In the meantime, 45% of analysts vote for further strengthening of the dollar. The opposite opinion is shared by 35% and the remaining 20% of experts have taken a neutral position. All trend indicators and oscillators on D1 are colored red, although 25% of the latter give signals that the pair is oversold.

The nearest target for EUR/USD bears will be March 7 low 1.0805. And if they manage to break through this support, they will then aim for the 2020 low of 1.0635 and the 2016 low of 1.0325.

The bulls will try to lift the pair above the level of 1.1000, to overcome the resistance at 1.1050 and, if possible, to reach the zone of 1.1120-1.1137. Their next target is the March 31 high of 1.1184.

In addition to the European Central Bank meeting, next week's economic calendar includes the release of German consumer data on Tuesday, April 12 and US consumer data on April 12 and 14. April 15 in the United States and most European countries is a day off, Good Friday.

GBP/USD: Fed Hawks and Bank of England Doves

The key and very strong support for the pair is the low of March 15 (and at the same time of 2021-2022), 1.3000. The GBP/USD bears went to break through it, reaching 1.2981 on April 08 during the US session. It seems that European traders, including British ones, are hesitant. But the Americans treat European currencies with disdain, to put it mildly, and continue to put pressure on them against the backdrop of the hawkish minutes of the Fed meeting and the comments of the top leaders of this regulator. As for their colleagues from the Bank of England, the latest comments of these officials were very soft, and raised doubts in the market as to whether the Bank will be able to justify the expectations of tightening monetary policy.

The last chord of the week after the rebound sounded at 1.3031. If the GBP/USD pair still manages to consolidate below 1.3000, this will open the way for it to the November 2020 lows around 1.2850, and then to the lows of September 2020 in the 1.2700 zone. This development is supported by only 35% of analysts. The remaining 65% are waiting for a correction to the north, and here the levels 1.3050, 1.3100 and the zone 1.3185-1.3215 will act as resistance, then 1.3270-1.3325 and 1.3400. All indicators on D1, as in the case of EUR/USD, point south, 15% of oscillators signal the pair is oversold.

As for the events concerning the economy of the United Kingdom, we can highlight the publication of data on the country's GDP and industrial production on Monday April 11, as well as on retail sales on Tuesday April 12. We will receive a package of information from the UK labor market on the same day, and we will get information from its consumer market on Wednesday, April 13.

USD/JPY: Japanese Are Against A Weak Yen

We titled our previous review as ?125.09: No More Anti-Records??. After a week, we can say that not yet, there will not be. And although the USD/JPY pair was moving north for a while, it fixed a local maximum at 124.67 this time, and ended the trading session at 124.36.

Recall that due to the super-soft monetary policy of the Bank of Japan, the yen continued to weaken, and the USD/JPY pair reached a record multi-year level of 125.09 on March 28, which is not far from the 2015 high of 125.86.

There are no expected releases of any important statistics on the state of the Japanese economy this week. The only thing that can be noted is the speech of the head of the Bank of Japan, Haruhiko Kuroda, on Wednesday, April 13. But it is unlikely to pull on a sensation. Although here one should take into account the statement of Hideo Hayakawa, the former chief economist of this organization, that against the background of the weakening yen, the Japanese Central Bank may adjust the parameters of monetary policy in July. ?While the Bank of Japan has repeatedly said that the weak yen is positive for the economy as a whole, in reality this impact is close to 50/50, and household discomfort will increase further as inflation in Japan rises as well. The vast majority of Japanese do not welcome the weak yen,? Hideo Hayakawa said on April 8. In his opinion, "it is too naive for the Bank of Japan to say that a weak yen is good when the government takes measures to solve the problem of rising prices and limiting gasoline prices."

Strategists at Rabobank also believe that a quick USD/JPY jump above 125.00 increases seriously the likelihood that the Japanese regulator will revise its quantitative easing (QE) program.

At the moment, the probability that the pair will try a second test of resistance in the 125.00-125.09 area is estimated as 50/50. However, when moving from a weekly forecast to a forecast for the second half of April and May, the vast majority (85%) of experts predict the strengthening of the Japanese currency and expect to see the pair in the 115.00-117.00 zone.

Among the indicators on D1, as in the previous two cases, there is complete unanimity: 100% of trend indicators and 100% of oscillators look up, although 25% of the latter are in the overbought zone. Given the high volatility of the pair, the zones 123.65-124.05, 122.35-123.00 and 121.30 can be identified as supports. Then follow the zones 120.60-121.30, 119.00-119.40, 118.00-118.35.

CRYPTOCURRENCIES: Correction or the Beginning of a New Collapse

Daily Market Analysis from NordFX in Fundamental_IaZIAZ4

Miners mined the anniversary 19 millionth bitcoin On Friday, April 01, out of the 21 million provided by the algorithm. That is, less than 10% is left to be mined. And this is it. Thanks to this, bitcoin, as conceived by its creator (or creators), will become a super-scarce asset, which will push its value further and further up. This is what many market participants are counting on.

The trend towards the accumulation of digital gold has continued lately. Analysts from the Glassnode company noticed that, in addition to the ?whales?, the so-called ?shrimp? (addresses with a balance of less than 1 BTC) also contributed to the accumulation. Since the January 22 low, they have accumulated 0.58% of the market supply, bringing their share to 14.26%.

The volumes of accumulation began to exceed emission many times over. According to Glassnode, the rate of outflow of coins from centralized platforms has increased to 96,200 BTC per month, which is extremely rare in historical retrospect. Exchange balances fell to the levels of August 2018, breaking through the plateau observed since September 2021. The number of coins in bitcoin addresses that tend to accumulate rose by 217,000 BTC since December 04, 2021 to a record 2,854,000 BTC. Based on the figures presented, it is possible to obtain a daily accumulation rate of 1800 BTC, which is twice the emission rate.

This trend is confirmed by the report of the analytical company IntoTheBlock. According to it, the total amount of coins in the wallets of long-term investors reached a record 12 million BTC in Q1 2022 worth more than $551 billion. ?This indicates a phase of accumulation, which can help strengthen faith in bitcoin as a store of value,? IntoTheBlock believes.

The most fantastic forecast regarding the future of the main cryptocurrency has been given by analysts from the investment company VanEck. According to their calculations, the price of bitcoin could reach $4.8 million if the cryptocurrency becomes a global reserve asset. Such a forecast was obtained taking into account the M2 money supply, that is, the amount of cash in circulation and all kinds of non-cash funds. There is also a lower range - $1.3 million per 1 BTC, calculated based on the M0 money supply, which does not include non-cash funds.

VanEck analysts warn that their forecast is only intended to serve as a starting point for investors who want to estimate the possible value of bitcoin in one of the unlikely scenarios. At the same time, according to the authors of the forecast, it is not bitcoin at all, but the Chinese yuan that is the primary contender for the status of world reserve currency.

Even the most notorious crypto fans understand that millions of dollars per coin are still infinitely far away. However, as for the foreseeable future, a number of scenarios look quite optimistic here. Thus, Galaxy Digital CEO Mike Novogratz believes that the arrival of new investors and innovations, developments in politics and the economy, and the acceptance of bitcoin by the authorities improve the forecasts for BTC for 2022. ?Initially, I said that bitcoin would have an unstable year, that the price would fluctuate in the range of $30,000 to $50,000. But given how the markets are trading, new investors and innovation, the development of the Web3 and the metaverse, I'm more optimistic. Therefore, I won?t be surprised if cryptocurrencies grow significantly by the end of 2022,? the billionaire said.

In his opinion, the adoption of bitcoin will continue as everyone understands what an unstable world we live in. ?Bitcoin began to write a new history at a time when Europe and the United States blocked Russia's financial flows. The military action in Ukraine creates a lot of inflationary pressure, generates a lot of risks and worries, but adds confidence to crypto investors and accelerates the adoption of digital assets,? the CEO of Galaxy Digital said.

Raoul Pal, a former Goldman Sachs employee and current Real Vision CEO, shares a similar opinion. He said in the MetaLearn podcast that the world is ready for a new wave of bitcoin adoption, and a further fall in the market will have a beneficial effect on its growth. ?Sovereign states, especially wealth funds, will start looking for a long-term asset that will provide some security. Therefore, bitcoin will be studied by them and we will see its further adoption - not necessarily as a currency, but as an asset. I think this is a very interesting solution: the global use of bitcoin as a protective collateral reserve asset."

According to Raul Pal, the macroeconomic situation suggests that the chances of another bitcoin sell-off are slim. Therefore, most market participants are likely to stick to a long-term strategy and not actively trade cryptocurrencies.

However, digital gold stopped rising after reaching a high of $48,156 on March 28. The bulls have not been able to push the BTC/USD pair above the 200-day moving average, and at the time of writing, on the evening of April 08, it is trading around $43,000. The total market capitalization is below the important psychological level of $2 trillion, having fallen from $2.140 trillion to $1.985 trillion during the week. The Crypto Fear & Greed Index also began to feel worse, falling from neutral 50 to 37 points, which are already in the Fear zone.

Renowned analyst and trader Cheds views the ascending triangle that has been forming since January 24 as a bullish sign. Such a triangle, he says, is usually a bullish continuation pattern. And in the event of an upside breakout, ?the measurable move will be the height of the triangle, which will bring from $56,000 to $58,000.?

At the same time, the expert advises traders to keep a close eye on the 200-day moving average as this technical indicator is currently acting as resistance. Chads believes that if the bulls manage to keep BTC above $45,000, the cryptocurrency will be ready to storm the SMA-200 resistance for a further 26% gain. Otherwise, the bulls face the risk of a sell-off.

As mentioned, BTC/USD is currently trading at $43,000, below Cheds' support. However, given the volatility of the flagship cryptocurrency, the victory of the bears cannot yet be considered complete. A breakthrough to the south may be false. Moreover, bitcoin has ceased to be independent. It was in 2010, when 10,000 BTC could buy two pizzas, when it lived its own life. Now it has matured and become part of the global economy. Bitcoin is now showing an almost complete cyclical correlation with the S&P 500, which has recently hit 0.9. And it falls after the US stock market. And the latter, in turn, depends on the risk appetites of global investors.

If the craving for risky assets recovers, the crypto market will also go up. Otherwise, according to some experts, we can expect the BTC/USD pair to decline to March lows near $37,000 per coin. The probability of quotes falling even lower, to $30,000, is also quite high.


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
#113 - April 09, 2022, 04:47:19 PM

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Forex and Cryptocurrencies Forecast for April 18 - 22, 2022


EUR/USD: Fed's Apples and ECB's Oranges

The dollar continues to strengthen, while the EUR/USD pair moves down. A week's low was recorded at 1.0757 after the ECB meeting on Thursday, April 14. After correction, the final chord, sounded at around 1.0808.

We named three reasons for the growth of the US currency in the previous forecast. The first is the difference between the monetary policies of the Fed and the ECB. Now, the probability of further tightening the position of the US Central bank has increased even more against the background of the latest data on inflation in the United States: the consumer price index has exceeded the forty-year high and reached 8.5%. Such an acceleration of inflation may force the regulator to act more vigorously and to revise its plans to raise the key rate and reduce the balance sheet in May.

New York Fed President John Williams, who is also vice chairman of the FOMC (Federal Open Market Committee), said in an interview with Bloomberg that it makes sense for the Fed to bring interest rates to a neutral level as soon as possible, which, not stimulating, it does not hinder economic growth, and is in the range from 2% to 2.5%. Therefore, a 0.5% increase in federal borrowing costs at the May FOMC meeting looks quite realistic.

In contrast to the Fed's hawks, their European counterparts remain extremely dovish. The ECB left the interest rate unchanged at 0% at its meeting on April 14, which, in fact, was expected. Moreover, the Bank's representatives have already said earlier that the growth in the cost of lending in the context of continuing economic uncertainty could do more harm than good.

The head of the regulator, Christine Lagarde, confirmed at a press conference that followed the meeting that the ECB is moving more slowly than the Fed, and that the Eurozone will be hit harder by the military actions in Ukraine. The American and European economies, according to Ms. Lagarde, are as incomparable as apples and oranges. Such a fruity allegory made a strong impression on the market, as a result of which the EUR/USD pair collapsed to the zone of two-year lows.

Indeed, the current economic situation in the euro area does not inspire optimism and, according to many experts, will continue to worsen in the future. The German economic sentiment index published last week fell to a new multi-month low: minus 41.0 (minus 39.3 a month earlier). The index of current economic conditions of this locomotive of the European economy also fell to minus 30.8 in April (minus 21.4 in March). Against this background, the German GDP growth forecast for 2022 was lowered from 4.5% to 2.7%.

The situation may become even more complicated, as the President of the European Commission Ursula von der Leyen and the head of EU diplomacy Josep Borrell announced their intention to include restrictions on the export of hydrocarbons from Russia in the next package of anti-Russian sanctions. Thus, the risk of stagflation in Europe remains at a fairly high level.

We mentioned another reason for the pressure on the euro - the presidential elections in France in the previous review. Their first round took place on Sunday April 10. So far, the incumbent President Emmanuel Macron is leading with 27.84% of the vote. Marine Le Pen, head of the far-right National Rally Party, gained 23.15%. The gap is not very large and there is still a possibility that the opposition may win in the second round on April 24. Its leader Marine Le Pen is a Eurosceptic. Please note that she called for almost the exit of the country from the Eurozone back in 2017. And if this lady comes to power, the EUR/USD pair, according to a number of analysts, may fall to the level of 1.0500, or even lower.

There is another factor pushing the pair south, which is the deterioration of global risk appetite. The S&P500 stock index has been falling for the third week in a row, while demand for safe-haven assets such as the dollar and US Treasuries, on the contrary, is growing.

At the moment, 50% of analysts vote for further strengthening of the dollar. The opposite opinion is shared by 40% and the remaining 10% of experts have taken a neutral position. All trend indicators and oscillators on D1 are colored red, although 15% of the latter give signals that the pair is oversold.

The nearest support is located at the level of 1.0800. The nearest target for EUR/USD  bears will be April 14 low at 1.0757. And if they manage to break through this support, they will then aim for the 2020 low of 1.0635 and the 2016 low of 1.0325. The bulls will try to lift the pair above the 1.1000 level and, if possible, reach the 1.1050 zone. But to do this, they first need to overcome the 1.0840 and 1.0900-1.0930 resistances.

The upcoming week's calendar includes speeches by Fed and ECB heads Jerome Powell and Christine Lagarde on Thursday April 21. Data on unemployment and manufacturing activity in the US will also be published on this day. As for the indicators of business activity in Germany and the Eurozone as a whole, they will become known on Friday, April 22.

GBP/USD: Battle for 1.3000

In the previous forecast, most experts (65%) supported the correction of the GBP/USD pair to the north and were absolutely right. It seemed at the beginning of the week that the victory was on the side of the bears: they managed to overcome the support in the 1.3000 zone and lower the pair to 1.2972.

Recall that 1.3000 is a key support/resistance level as it is not only the March 15 low, but also the 2021-2022 low. The bulls managed to seize the initiative on Wednesday, April 13, break through this resistance, reach the height of 1.3147 and complete the week also above it, at around 1.3060.

The pound was supported by a possible tactical victory of the Bank of England over the FRS in the fight for raising interest rates. Inflation in the UK increased from 6.2% to 7.0%. The Bank of England predicted that it would peak in April, accelerating to 7.2%. However, a number of banks did not agree with the regulator's opinion, believing that inflation will not stop at this point, reaching 9.0% in April, and then its growth will continue. Therefore, the Bank of England will have to do something about it. And this ?something? is, of course, another increase in interest rates. It was this prospect that pushed the British currency to growth.

We can expect the battle for 1.3000 to continue next week. If the victory is on the side of the bears, they will try to update the April 13 low of 1.2972 and open the way to the November 2020 lows around 1.2850, and then to the September 2020 lows in the zone 1.2700. The nearest support is 1.3050. 30% of analysts vote for the victory of the bears, while the majority (70%) side with the bulls. The resistance levels are 1.3100, 1.3150 and the zone 1.3190-1.3215, then 1.3270-1.3325 and 1.3400. Among the indicators on D1, the advantage of the reds is evident. Among the oscillators, 75% are colored in this color, another 15% are green and 10% are neutral gray. Trend indicators have 100% on the red side.

Among the events concerning the economy of the United Kingdom, we can highlight the speeches of the Governor of the Bank of England Andrew Bailey on April 21 and 22. Data on business activity in the manufacturing and services sectors of the UK will also be published on Friday, April 22.

USD/JPY: Do We Expect New Anti-records from the Yen?

Daily Market Analysis from NordFX in Fundamental_O0hDlYr

It seems that nothing can stop the fall of the yen and the growth of the USD/JPY pair. The Japanese currency sets an anti-record after an anti-record, and the pair recorded another high at 126.67. The last time it climbed so high was on May 01, 2002, that is, 20 years ago.

We noted in the last review that the majority of Japanese people are against the weak yen. However, despite this, the Bank of Japan still refuses to raise the key rate and reduce monetary easing. The regulator believes that maintaining economic activity is much more important than fighting inflation. And this divergence with the US Federal Reserve's monetary policy is pushing the USD/JPY further north.

The pair closed the week's trading session at 126.37. 45% of analysts vote for maintaining the uptrend next week. A little more, 55%, remembering a powerful correction to the south after a similar rally in the last week of March, expect something similar now. It should be noted here that when switching to the forecast for may-June, the number of supporters of the dollar strengthening increases to 80%. We have already cited Rabobank strategists who believe that a quick USD/JPY jump above 125.00 will seriously increase the likelihood that the Japanese regulator will revise its quantitative easing (QE) program. And this jump took place last week.

There is complete unanimity among the indicators on D1: 100% of trend indicators and 100% of oscillators look up, although 35% of the latter are in the overbought zone. Without a doubt, the main support in the coming days will be the levels of 126.00 and 125.00. Then, taking into account the high volatility of the pair, we can single out the zones 123.65-124.05, 122.35-123.00 and 120.60-121.30. As for the plans of the bulls, they will try to update the high of April 15, and rise above 127.00. An attempt to designate their subsequent goals, focusing on the levels of 20 years ago, will rather look like fortune telling.

There are no expected releases of any important statistics on the state of the Japanese economy this week.

CRYPTOCURRENCIES: April 12: Space Flight Day. But not for bitcoin.

It is impossible to call the first half of April successful for the crypto market. And if bitcoin was still trying to jump over the 200-day SMA two weeks ago, on April 04, then the bulls completely capitulated and a local low was recorded at $39.210 on April 12. It is noteworthy that Cosmonautics Day is celebrated on this day: Yuri Gagarin went into space and circled the planet Earth on April 12, 1961, for the first time in the world. The BTC/USD pair did not make a breakthrough to the stars. Rather, we observed a fall from orbit.

As of this writing, on the evening of Friday, April 15, the pair is trading around $40,440. The total market capitalization has slightly decreased and is still below the important psychological level of $2 trillion, at the level of $1.880 trillion. The Crypto Fear & Greed Index did not stay in the previous orbit either: it fell from 37 to 22 points and returned to the Extreme Fear zone.

We wrote earlier that bitcoin has become a part of the global economy and now demonstrates a strong correlation with stock indices. Therefore, its quotes chart is largely congruent, first of all, with the S&P500 chart. So, as of March 2022, according to Arcana Research, the correlation coefficient between BTC and S&P500 was 0.497. The main cryptocurrency falls and rises after the stock market. And that, in turn, falls or rises depending on the actions of the US Federal Reserve. There is no longer any question of bitcoin's independence.

As we have already mentioned, there has recently been a clear trend towards the accumulation of digital gold. The volumes of accumulation began to exceed emission many times over. According to Glassnode, the rate of outflow of coins from centralized platforms has increased to 96,200 BTC per month, which is extremely rare in historical retrospect. In addition to the ?whales?, the so-called ?shrimps? (addresses with a balance of less than 1 BTC) also contributed to the accumulation. So why doesn't hodle sentiment lead to higher prices?

The answer is simple: no new investors. The old ones either go into the state of long-term holders of coins, or get rid of them. Approximately $439 million worth of crypto positions were liquidated on April 12 alone, according to Coinglass. At the same time, more than 88% of closed orders accounted for long positions. Bitcoin futures contracts for $160 million were also closed. But there is no strong inflow of new investments into the crypto sector.

Investors have lost their appetite for risk since the end of March, the DXY dollar index and US 10-year bond yields reach new highs on a regular basis. Due to rising inflation, which reached 8.5% in the US in March, the markets are waiting for the US Central Bank to raise interest rates again at the May meeting, and not by 0.25%, but immediately by 0.5%. This is the reason why interest from high-risk assets flows to more conservative instruments.

According to Bloomberg analysts, the value of the flagship cryptocurrency may soon fall to $26,000. The experts emphasized that if the technical analysis pattern called ?bear flag? works, then such a scenario will be inevitable. In their opinion, the BTC rate is now on its way to testing a key support level around $37,500. If it does not hold above this mark, the market is in for a disaster.

Analyst Jeffrey Halley's forecast sounds slightly more optimistic. He believes that the flagship cryptocurrency continues to trade within the established range, the lower limit of which is at $36,500. If BTC falls even more, it can lead to serious losses for traders and investors. However, if the price of bitcoin soars in the near future above the upper limit of the range of $47,500, this will be a prerequisite for reaching a new record high.

There are also influencers who are not worried or upset by the current market situation at all. These include Michael Saylor, CEO of Microstrategy, a company known for its investments in bitcoin, and Cathie Wood, head of investment company Arch Invest, who still believe in bitcoin and look forward to its growth.

Saylor and Wood spoke at the Bitcoin 2022 conference in Miami and concluded that the Fed's monetary policy will continue to be inflationary, pushing prices up. In such a situation, according to Cathie Wood, bitcoin, as a means of hedging, has great potential for growth and its price could reach a record $1 million per coin. ?It takes quite a bit of effort to do this,? the head of Arch Invest said. "We don't need much. All we need is for 2.5% of all assets to be converted to bitcoin.?

Well-known writer and investor Robert Kiyosaki has a similar opinion, he believes that the US dollar and other markets are on the verge of collapse due to rising food, oil and energy prices, as well as widespread inflation. The author of the bestselling book Rich Dad Poor Dad assured that what is happening in the world of finance is a sign of a coming crisis, and this process will simply destroy half the US population. He noted that cryptocurrencies in this situation are a good tool to reduce risks, but not all people resort to using this asset class. Kiyosaki emphasized that now 40% of Americans do not even have $1,000 in their savings. The inflation rate is rising, and this figure will soon exceed 50%. Then, according to the investor, a revolution will begin.

Morningstar analysts posted a report claiming that cryptocurrencies are no match for the stock and bond markets in terms of returns. At the same time, they note that bitcoin ?is still too risky to be compared to gold.? The authors of the report argue that, despite the prospect of significant profits that the cryptocurrency market can offer its participants, one must be very careful with it. ?Every breathtaking rally has led to an equally brutal crash at the end,? Morningstar notes.

It is difficult to argue that speculation or investment in digital assets is quite risky. But there are certain things in this business, as in any other, that allow you to get additional benefits. It is about them that we regularly talk about in our crypto life hacks section. This time it's about heat energy and a man named Jonathan Yuan who has kids who love to swim in the pool. However, they almost did not do this because the water was too cold.

Yuan himself is actively involved in mining and drew attention to the fact that his equipment generates too much heat. He purchased a heat exchanger and used it to install a system for heating water. According to him, thanks to this invention, the temperature in the pool can be maintained at about 32? C, and the crypto farm receives a water cooling system. Jonathan Yuan notes that almost everything can be heated according to this principle: living premises, garages and so on. It is assumed that the heating temperature can reach a maximum threshold of 60?C.

There are nuances here, however. When the inventor pushed his ASIC miners to the limit, the temperature in the pool rose above 43?C. His children did not like it either and they stopped swimming again. So, the ancient Greek ?father? of medicine, Hippocrates, was right, saying ?good things in small doses?.


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
#114 - April 17, 2022, 06:34:31 PM

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Forex and Cryptocurrencies Forecast for April 25 - 29, 2022


EUR/USD: Words Drive Trends

The main drivers of the past week were statements by important ECB and FRS officials. However, the beginning of the five-day period was relatively calm: the Easter weekend had its effect. Unlike the United States, Europe rested not only on Friday April 15, but also on Monday 18. The dollar was slightly supported on Monday by the comments from the representatives of the American regulator. According to Rafael Bostic, President of the Federal Reserve Bank of Atlanta, the base interest rate may be about 1.75% by the end of 2022, and Chicago Fed President Charles Evans believes that it will reach 2.25-2.50%. And the head of the Federal Reserve Bank of St. Louis, James Bullard, announced a possible rise in the key rate by 0.75% immediately at the May meeting of the FOMC (Federal Open Market Committee).

The situation changed dramatically on Tuesday: the EUR/USD pair reversed and, having soared by 175 points, reached the height of 1.0935 on Thursday, April 21. It was not the dollar but the euro that was supported this time by hawkish comments from the members of the European Central Bank Governing Council. Thus, the head of the Central Bank of Latvia, Martins Kazaks, said on Wednesday that an increase in the ECB rate is possible as early as July. His colleague, the head of the National Bank of Belgium, Pierre Wunsch, gave an interview to Bloomberg the next day, in which he noted that interest rates could become positive this year. ECB Vice-President Luis de Guindos confirmed this possibility, according to him the quantitative easing (QE) program may be completed in July, after which the path to raising rates will be open.

An additional impetus to the pair was given by the improvement in risk sentiment and the decline in the yield of American Treasuries. This sent the DXY dollar index down 1% after hitting a two-year high on Tuesday.

The situation changed for the third time on Thursday afternoon. The dollar went on a new offensive, assisted by a rise in the yield on 10-year US Treasury bonds, which rose to 2.974%, the highest level since December 2018. This happened thanks to Jerome Powell. Speaking at a meeting within the framework of the International Monetary Fund spring session, the head of the Fed confirmed the high probability of raising the interest rate by 0.5% at the next FOMC meeting on May 3-4. Such a move is under consideration, Powell said, as the U.S. job market is already "overheated." He did not rule out either that the rate could be increased by another 0.5% in June.

As for the head of the ECB, Christine Lagarde, speaking at the same IMF event, she refused to comment on the likelihood of an increase in the euro rate in July. ?This will depend on the economic performance,? Ms. Lagarde said vaguely, after which the EUR/USD pair flew down.

The head of the ECB decided to slightly tighten her position on the last day of the working session, April 22. Ыhe did not deny at this point that the European Central Bank's purchase program could end at the beginning of Q3 and added that interest rates could rise as early as 2022. Her words sounded more hawkish compared to Thursday's, but that didn't help the euro. The pair found its bottom only at 1.0770, after which there was a slight correction to the north and a finish at 1.0800.

The euro was slightly supported by the results of the televised debate between French President Emmanuel Macron and opposition leader Marine Le Pen. As the poll data showed, 56% of respondents considered that the incumbent president was more convincing in the debate than his rival.

The second round of the presidential elections in France will be held on Sunday 24 April. Emmanuel Macron won 27.84% of the vote in the first round. Marine Le Pen, head of the far-right National Rally Party, received 23.15%. Recall that she belongs to the Eurosceptics, and had called for almost the exit of the country from the Eurozone back in 2017. And if this lady comes to power, the EUR/USD pair, according to a number of analysts, may fall to the level of 1.0500, or even lower.

At the time of writing the review, the results of the election are still unknown, so the majority of analysts (50%) did not make any forecasts. 35% believe that the dollar will continue to strengthen. The opposite opinion is shared by only 15%. All trend indicators and oscillators on D1 are colored red, although 15% of the latter give signals that the pair is oversold. The nearest support is located at the level of 1.0770. The next EUR/USD bear target will be the April 14 low at 1.0757. And if they manage to break through this support, they will then aim for the 2020 low of 1.0635 and the 2016 low of 1.0325. Immediate resistance zone is 1.0830-1.0860, followed by 1.0900, the April 21  high of 1.0935 and 1.1000.

As for the release of macro data, the volume of orders for capital goods and durable goods in the US will be known on Tuesday, April 26.  Data on GDP and the state of consumer markets in Germany and the Eurozone will be received on Thursday, April 28 and Friday, April 29. In addition, preliminary annual data on US GDP will be released on Thursday.

GBP/USD: The Battle for 1.3000 Is Lost. Will there be a counterattack?

We assumed in the previous review that we are in for the continuation of the battle of bulls and bears, and the front line will pass in the zone of 1.3000. Recall that 1.3000 is a key support/resistance level as it is not only the March 15 low, but also the 2021-2022 low.

And now we must say that the bulls have lost this battle. Having raised the GBP/USD pair to the height of 1.3090, they finally weakened, and it flew down. The local bottom was fixed at 1.2822 on Friday, and the final chord sounded a little higher, in the zone of 1.2830.

The reasons for this collapse of the pound lie on both sides of the Atlantic Ocean. On the one hand, this is the hawkish position of the US Federal Reserve and the growth of US Treasury yields. On the other hand, there are cautious comments from the Bank of England (BoE) and weak macro statistics from the UK.

Commenting on the state of the economy on Thursday, the head of the British regulator, Andrew Bailey, said that the inflationary shock in the United Kingdom has more in common with the Eurozone than with the US. "We shouldn't be complacent about inflation expectations," Bailey added, reiterating that they were dealing with "a very tight line between fighting inflation and the impact of a shock on real incomes."

The day after the speech of the head of the Bank of England, the UK Office for National Statistics dealt another blow to the pound. It reported that retail sales fell 1.4% in March. This indicator followed the February decline of 0.5% and turned out to be much worse than the forecast, according to which the fall should have been only 0.3%.

Such a massive failure will most likely send investors into a shock and it will take time to restore their appetite for British currency purchases. The bears will try to build on their success and push the GBP/USD pair further down. 65% of analysts vote for this development, the remaining 35% expect the pair to correct to the north.

There is a total advantage of the red ones among the indicators on D1: 100% both among trend indicators and oscillators. True, as for the latter, a third is in the oversold zone. The immediate goal of the bears is to overcome the support of 1.2800, update the October 2020 lows around 1.2760 and open their way to the September 2020 lows in the zone 1.2685-1.2700. More distant targets for the pair's decline are located at the levels of 1.2400, 1.2250, 1.2085 and 1.2000. As for the bears, they will try to regain the initiative and fight again for 1.3000. However, they will need to overcome the resistances of 1.2860 and 1.2915 on this way. In case of a successful assault on 1.3000, resistance levels 1.3100, 1.3150 and the zone 1.3190-1.3215 will follow.

There are no significant data releases on the UK economy for the coming week. The only thing that can be noted is the release of data on the housing market of this country on Friday, April 29.

USD/JPY: Will the Bank of Japan Stand Its Ground?

The Japanese currency is hitting one anti-record after another, and the expectation that the past week would bring another one proved to be absolutely correct. The USD/JPY pair recorded another high at 129.39 on Wednesday, April 20. The last time it climbed this high was in May 2002, that is, 20 years ago.

The reasons for the fall of the yen are the same: divergence from the monetary policy of the US Federal Reserve. Despite the fact that the majority of the Japanese are against the weak yen, the Bank of Japan still refuses to raise the key rate even to zero and does not want to cut monetary stimulus. The regulator believes that maintaining economic activity is much more important than fighting inflation.

The regular meeting of the Japanese Central Bank will take place next week, on Thursday, April 28. According to strategists of Singapore's UOB Group (United Overseas Bank), the regulator will once again leave the parameters of its monetary policy unchanged. ?We are confident,? write UOB economists, ?that the BOJ will maintain its current loose monetary policy unchanged throughout 2022, and will also maintain massive stimulus, possibly until fiscal year 2023 at least.?

The yen received some support from reports that Treasury Secretary Shunichi Suzuki discussed the idea of coordinated foreign exchange intervention with his counterpart, US Treasury Secretary Janet Yellen. And it seems that "the American side sounded as if it would positively consider this idea." However, a source from the Japanese Ministry of Finance dampened hopes for a joint effort between the two countries, refusing to comment on the details of the conversation between Suzuki and Yellen.

Having renewed a multi-year high, the pair USD/JPY bounced back a little in the second half of the five-day period and ended it at the level of 128.53. 40% of experts vote for the bulls to storm new heights, 30% have taken the opposite position and 30% adhere to neutrality. Among indicators on D1, 100% of trend indicators look north, among oscillators, these are 90% of them (a third are in the overbought zone), the remaining 10% point south. The nearest support is located at 127.80-128.00, followed by 127.45, 126.30-126.75 zone and levels 126.00 and 125.00. The resistances are located at levels 128.70, 129.10 and 129.39. An attempt to designate the subsequent targets of the bulls will rather be like fortune telling. The only thing we can assume is that they will set a high of January 01, 2002, 135.19, as a distant target. Taking into account the fact that the pair has risen by 1400 points over the past 7 weeks, it can reach this height in a month and a half if this pace is maintained.

Aside from the BOJ meeting and its monetary policy report, there is no other important information on the state of the Japanese economy expected this week.

CRYPTOCURRENCIES: BTC from $30,000 to $200,000

Daily Market Analysis from NordFX in Fundamental_bS5wKqr

Throughout 2022, bitcoin has been moving along the Pivot Point around $40,000, trying to either reach $50,000 or fall to $30,000. The reason for such fluctuations, of course, is the US Federal Reserve. Investors cannot finally decide how to behave in the face of tightening monetary policy and rising dollar interest rates. As a result, their appetite for risk falls and flares up again. First of all, this applies to the stock market, along with which digital gold fluctuates as well.

We have repeatedly considered the correlation of the BTC/USD pair with the shares of technology companies. So, according to Arcane Research, the correlation between bitcoin and the Nasdaq Composite index reached its high since July 2020. The same indicator between the first cryptocurrency and gold has fallen to a historic low. It is physical gold that has recently been acting as a hedge against inflation, and its price came close to its historical maximum, reaching $2.070 per ounce on March 08 (the maximum price of $2.075 was recorded on August 2, 2020).

Bitcoin-ETP (Exchange Traded Product) shows an outflow of funds. If the current pace is maintained, the historical anti-record of July 2021 will be updated by the end of the month, when investors withdrew 13,849 BTC. The number of active addresses on the bitcoin network has dropped to 15.6 million, about 30% less than the January 2021 high. Many short-term (less than 155 days) holders and speculators have already parted with their BTC holdings, according to Glassnode data.

The market is currently supported by long-term holders (LTH). As we already wrote, there has recently been a trend towards the accumulation of digital gold among them. The volumes of accumulation began to exceed emission many times over. According to Glassnode, the rate of outflow of coins from centralized platforms has increased to 96,200 BTC per month, which is extremely rare in historical retrospect. In addition to the ?whales?, the so-called ?shrimp? (addresses with a balance of less than 1 BTC) also contributed to the accumulation, bringing their share to 14.26% of the market supply.

At the moment, about 15% of long-term holders are losing, but they not only continue to store coins, but also acquire new ones, counting on their growth in the future. For example, analytics software provider MicroStrategy intends to ?strongly pursue? its strategy and continue to build up reserves in bitcoin. This was stated by CEO Michael Saylor in a letter to the US Securities and Exchange Commission. According to Bitcoin Treasuries, MicroStrategy holds 129,218 BTC worth $5.17 billion in reserves. The company's division made its last purchase of $190.5 million in early April. For comparison, Tesla, which is in second place after MicroStrategy, owns 43,200 BTC worth about $1.7 billion.

At the time of this writing, Friday evening, April 22, the total crypto market capitalization is still below the important psychological level of $2 trillion, at $1.850 trillion ($1.880 trillion a week ago). The Crypto Fear & Greed Index slightly improved its readings: it rose from 22 to 26 points and returned from the Extreme Fear zone to the Fear zone.

The BTC/USD pair is trading around $39,700. The chart of the past four months, with its rising highs and lows, gives investors hope for a further rise in price. However, everything will depend on the May Fed meeting and investor risk sentiment. Recall that BitMEX co-founder Arthur Hayes has predicted a drop in bitcoin to $30,000 by the end of the second quarter due to the decline in the Nasdaq index. The same figure of $30,000 is also mentioned by cryptocurrency analyst and trader Michael van de Poppe, although he points to another reason: geopolitical tensions in Eastern Europe due to Russia?s military invasion of Ukraine.

Many other experts do not expect anything good from the BTC/USD pair in the near future either, although they build optimistic forecasts for the medium and long term.  So, according to Anthony Trenchev, CEO of the Nexo crypto-landing platform, the price of the first cryptocurrency may rise above $100,000 over the next 12 months. However, he is "worried" about the short-term outlook for bitcoin. In his opinion, the rate may fall along with traditional stock markets as a result of the US Central Bank curtailing the monetary stimulus program.

Paolo Ardoino, CTO of Bitfinex, predicts similar dynamics of the flagship cryptocurrency. This specialist believes that bitcoin will be ?much higher? than $50,000 by the end of 2022. However, he admits a sharp drop in prices in the near future. ?At the moment, we are living in conditions of, I would say, global uncertainty in the markets, not only cryptocurrencies, but also stock markets,? Ardoino said.

Cryptocurrency market expert Ali Martinez analyzed the price chart of bitcoin and said that its value could fall to $27,000. It is important for the bulls to stay above the critical support level in order to prevent this from happening. According to the Fibonacci levels, this support is in the $38,530 area. If a breakdown occurs, then the rate of digital gold will fall to $32,853 or even $26,820. Like most analysts, Martinez also believes that one should not focus only on technical analysis and discard the fundamental one, since much depends on the geopolitical situation in the world now.

Cryptocurrency analyst Benjamin Cowen is confident that bitcoin is approaching "the point of choosing the direction of the trend." Cowen elaborates that this has happened before: ?In 2013, bitcoin made a low, then a second, then a third, and eventually began to rise. And then in 2018, when there were higher lows, we thought that the same thing would happen as in 2013, but in the end, bitcoin fell to a new low.?

According to the analyst, in order to restore the bullish trend and reduce the likelihood of a bearish one, the BTC/USD pair needs to rise above the 200-day SMA, which is at around $47,440 at the time of writing. ?If bitcoin can muster the courage to rise above its 200-day SMA and move to the $50,000 level, then that would look pretty optimistic. But what happens if the market drops to $30,000 and then bitcoin goes up again? There's a good chance we'll get back to $40,000 or maybe $43,000,? said Benjamin Cowen.

Most likely, the prospect of the return of the flagship cryptocurrency from $30,000 back to $40,000 in the current situation will not please investors very much, since the coin is currently trading in the region of $40,000. Therefore, to cheer them up, we will quote another specialist, Nicholas Merten from DataDash, who believes that BTC can set new record highs as early as next year. According to him, the bulls still have not lost control despite the current market fluctuations: ?The market is currently far from impressing investors, but this situation is always observed during the beginning of accumulation. This is how the structure of the trend begins to form.?

According to Merten, the fact that bitcoin has begun to make higher lows and higher highs confirms that the bulls are at the helm, no matter how things look at the moment. The analyst believes that since this situation persists, then the BTC rate has every chance of reaching $150,000 and even $200,000 within the next year.


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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#115 - April 24, 2022, 03:37:31 PM

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New NordFX Super Lottery: 202 Prizes in 2022

Daily Market Analysis from NordFX in Fundamental_OcBnpqn

The NordFX brokerage company started a new super lottery, which will give away 200 cash prizes of 250, 500 and 1,250 USD, as well as 2 two super prizes of 10,000 USD each. The total prize fund will be 100,000 USD.  Draws will take place on July 04, October 04, 2022, and January 04, 2023.

It is very easy to take part in the lottery and get a chance to win one or even several of these prizes. It is enough to have a Pro account in NordFX (and for those who do not have it - register and open a new one), top it up with $200 and... just trade.

Having made a trading turnover of only 2 lots in Forex currency pairs or gold (or 4 lots in silver), the trader will automatically receive a virtual lottery ticket. The number of such lottery tickets for one participant is not limited. The more deposits and the greater the turnover, the more lottery tickets the participant will have, and the greater their chances of becoming a winner.

Another advantage is that lottery winners receive their winnings not as bonuses, but as real money, which, if they wish, can be either used in further trading or withdrawn without any restrictions.

Visit the NordFX website for more details. You can become a participant of the Super Lottery 2022 and start receiving lottery tickets right now.


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
#116 - April 28, 2022, 04:37:07 PM

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Forex and Cryptocurrencies Forecast for May 02 - 06, 2022


EUR/USD: Euro Updates Five-Year Low, We Are Waiting for the Fed (FOMC) Meeting

Daily Market Analysis from NordFX in Fundamental_ojGSy2o

The DXY index that measures the US dollar against a basket of six other major currencies updated its 20-year high on Thursday, April 28. The reason for this growth is still the same, and we have repeatedly written about it: the Fed began to tighten its monetary policy earlier than other major central banks. It is expected that the FOMC (Federal Open Market Committee) may raise the key interest rate by 0.5% at the next meeting on May 4. This is the minimum. For example, James Bullard, the head of the Federal Reserve Bank of St. Louis, did not rule out that the rate could be raised by 0.75% straight away.

Other national regulators are moving much more slowly (or not at all) amid the US Fed's hawkish activity. Their economies are showing weaker recovery from the crisis caused by the COVID-19 pandemic, and this does not allow central banks to quickly curtail monetary programs incentives (QE) and increase borrowing costs.

Of course, this applies to the European Union as well, which also suffers additional economic losses caused by the sanctions imposed on Russia due to the military invasion of Ukraine. Recall that the dependence of the EU countries on Russian energy resources is very high.

Against this background, the dollar continued to push the European currency, and the EUR/USD pair rewrote the five-year low, falling to 1.0470 on April 28. Thus, the losses of the European currency has exceeded 700 points in April alone. There was a slight rebound at the very end of the five-day period and a finish at the level of 1.0545.

The level of 1.0500 plays the role of a support, which may lead to a reduction in the volume of short positions and, as a result, to a fairly strong correction to the north. If this does not happen, then the next target for the bears will be the 2016 low of 1.0325. It is possible that we will see the parity of the euro and the dollar 1:1 soon. However, much depends on what happens to the interest rate at the US Federal Reserve meeting on May 4, and what will be said by the management of this regulator at the subsequent press conference.

At the time of writing, analysts' votes are almost evenly divided. 35% are confident that the dollar will continue to strengthen, 30% have the opposite opinion, the remaining 35% have taken a wait-and-see attitude. Not surprisingly, with the current dynamics of the pair, 100% of the trend indicators and oscillators on D1 are colored red, although 25% of the latter give signals of the pair being oversold. The nearest support is located at 1.0500, followed by the April 28 low of 1.0470, and the bears' further goals for EUR/USD are described above. The nearest resistance zone is 1.0550-1.0600, 1.0750-1.0800, 1.0830-1.0860, 1.0900-1.0935 and 1.1000.

As for the coming week, in addition to event No. 1, the Fed meeting, the calendar includes the release of data on retail sales in Germany and business activity in US manufacturing sector (ISM) on Monday, May 02. ECB President Christine Lagarde is expected to speak the next day. We will find out the volume of retail sales in the European Union as a whole on Wednesday, May 04. The ADP report on US private sector employment will be published on this day as well. Another portion of data from the US labor market will arrive on Friday, May 06, including such an important indicator as the number of new jobs outside the agricultural sector (NFP).

GBP/USD: The Pound Updates its Two-Year Low, We Are Waiting for the Meeting of the Bank of England

We stated in the previous review that the bulls' battle for 1.3000 is lost. Answering the question whether there will be a counteroffensive, the majority of experts (65%) answered that no, there won't be, and the pound will continue to fall. This forecast turned out to be absolutely correct, and despite the oversold signals, the GBP/USD pair reached a local bottom at 1.2410 on Thursday, April 28. The last time it was at this level was in June 2020. As for the last chord of the week, it sounded in the 1.2575 zone.

Next week will see not only the meeting of the US Federal Reserve, but also that of the Bank of England. According to forecasts, the regulator of the United Kingdom may raise the interest rate from 0.75% to 1.0%. However, since its meeting will be held on May 5, that is, a day later than the Fed, the nine members of the MPC (Monetary Policy Committee) of the Bank will have time to adjust their position depending on the decision of their overseas colleagues.

In the meantime, the vast majority of experts (70%) remain neutral ahead of both meetings. 15% of them have taken the liberty of predicting a further weakening of the British pound, the same amount expects the pair to correct to the north. There is still a total advantage of the red ones among the indicators on D1: 100% among both trend indicators and oscillators. The immediate target of the bears is to overcome the support at 1.2500, further targets for the pair's decline are located at the levels of 1.2400, 1.2250, 1.2075 and 1.2000. As for the bulls, if they manage to seize the initiative, they will face resistance in the zones of 1.2600, 1.2700-1.2750, 1.2800-1.2835 and 1.2975-1.3000.

Regarding the release of statistics on the economy of the United Kingdom, the PMI (Purchasing Managers Index) in the manufacturing sector will be published on Tuesday, May 3. The Composite PMI and the PMI in the services sector will be announced the next day, a little ahead of the Bank of England meeting. The publication of PMI in the UK construction sector on Friday 06 May will complete the picture of business activity.

USD/JPY: The Yen Updates a 20-Year low. What else to expect?

A new anti-record for the Japanese currency was fixed at 131.25 yen per dollar. The USD/JPY pair made a correction to the south in the first half of the week?: up to the level of 126.92. But then, following the meeting of the Bank of Japan, we witnessed a new rally of 433 points. This was followed by a rather powerful bounce by 190 points and a finish at 129.75.

Some experts expected that the Japanese regulator might step back a bit from its ultra-soft monetary policy. Moreover, before that, various government officials had talked a lot about the fact that Japanese households are unhappy with the surge in inflation, and that, given the actions of the US Federal Reserve, it would be time to adjust their monetary policy. But the Bank of Japan remained true to itself, leaving the negative interest rate (-0.1%) unchanged and declaring its readiness to buy an unlimited number of bonds each session as needed.

According to many analysts, the Central Bank will maintain its soft monetary policy unchanged throughout 2022, and will also maintain massive incentives, perhaps at least until fiscal year 2023.

The yen was further hit by rising US 10-year Treasury yields, which rose 48 bp to 2.83% in April alone, widening the gap with similar Japanese securities. And here is the result: if the pound fell to a two-year low, the euro - to a five-year low, the yen fell to the lowest values in the last twenty years!

35% of experts vote for the fact that the bulls will storm new heights, 50% have taken the opposite position. The remaining 15% are neutral, waiting for the May meeting of the Fed. Among trend indicators and oscillators on D1, 100% are looking north, but among oscillators, 15% signal that the pair is overbought.

The nearest support is located at 129.00-129.40, followed by 127.80-128.00, 127.45, 126.30-126.75 zone and levels 126.00 and 125.00. Resistances are located at the levels of 130.00-130.35 and 131.00-131.25. An attempt to designate the subsequent targets of the bulls will rather be like fortune telling. The only thing that can be assumed is that they will set the January 01, 2002 high of 135.19 as their goal.  If the pair's growth rate is maintained, it can reach this height as early as in June.

No important information regarding the state of the Japanese economy is expected to be released this week. Traders also need to keep in mind the two upcoming holidays: Japan celebrates Constitution Day on Tuesday, May 03, and the Greenery Day on Wednesday May 04.

CRYPTOCURRENCIES: Trends, Forecasts and Hollywood

Bitcoin has been moving along the Pivot Point around $40,000 throughout 2022, trying to either reach $50,000 or fall to $30,000. The fight between bulls and bears continued last week as well. Looking at the chart of the BTC/USD pair, it is clear that the bears have had a clear advantage over the past five weeks. Bulls, of course, are making attempts to turn the tide, but no success is yet to be seen.

At the time of writing, Friday evening, April 29, the total crypto market capitalization is still below the important psychological level of $2 trillion: at $1.752 trillion ($1.850 trillion a week ago). The Crypto Fear & Greed Index has slightly worsened its readings: it has dropped from 26 to 23 points and has returned from the Fear zone to the Extreme Fear zone. The BTC/USD pair is trading around $38,700.

The correlation of the flagship cryptocurrency with stock indices such as the S&P500 and Nasdaq Composite is still very strong. The correction in US tech companies began late last year, and many of the industry's stocks are currently trading 50-70% below their highs. Investors, anticipating a sharp rise in interest rates by the Fed, switched to the US dollar, losing their appetite for risk assets, which hit the stock and cryptocurrency markets. The high risk of stagflation in many developed countries, the new coronavirus outbreak in China, the escalation of the armed conflict between Russia and Ukraine, and other processes affecting the global economy do not add optimism. So, there are many chances for bitcoin to go down to $30,000 per coin.

According to trader and analyst Tony Weiss, the main cryptocurrency has broken support levels, so the risks of another big fall are high. The coin needs to hold around $39,500 for this not to happen.

Cryptocurrency trader nicknamed Kaleo also believes that bitcoin has not yet reached the level that can be considered a bottom with confidence. According to him, the cryptocurrency is preparing to retest the lows last seen in mid-2021. (Recall that the BTC/USD pair found a bottom at $29.066 on June 22, 2021). Bitcoin is currently inside a big wedge pattern and according to Kaleo, it will be broken in the coming weeks, with the asset itself expected to fall by about 28%. In addition, the expert warned that even if we see a bounce above $41,000, it will not change the situation much.

Analyst Kevin Swenson has suggested a way to accurately predict trend reversals. According to him, it is necessary to monitor the weekly volume of bitcoins on the Coinbase crypto exchange. This indicator has correctly pointed for Swenson to the price peaks and bottom of bitcoin since 2017. Swenson noted that investors need to see a significant increase in volume after the correction to be completely sure of a bottom: ?There is a small chance that large volumes will be observed when the rate bounces. It takes time to form a bullish trend. The bulls work together to raise the price, while the bear is usually alone.?

But, despite the current bearish trend, not everything is so sad. The price of bitcoin may reach $65,185 by the end of 2022. This forecast was given by financial experts interviewed by Finder. According to them, bitcoin will cost $179,280 on December 31, 2025, and $420,240 at the end of 2030. More than two-thirds of those surveyed believe that now is the time to buy the first cryptocurrency. Only 9% were in favor of exiting the asset.

87% of respondents included ethereum in the list of the most effective cryptocurrencies. Bitcoin was in second place with 71%. Half of the experts believe that bitcoin will be eventually displaced from the position of the most popular cryptocurrency by a more advanced blockchain, 38% are sure that digital gold will stay on the throne.

Recall that giving a long-term forecast, the head of ARK Invest, Katherine Wood, and CEO of MicroStrategy, Michael Saylor, expressed the opinion that the flagship cryptocurrency will definitely reach the price mark of $1 million. According to them, this will happen closer to 2030.

The same figure of $1 million was voiced by another specialist, Jason Pizzino last week, who explained under what conditions the coin will reach this mark. To do this, firstly, the flagship cryptocurrency needs to get rid from the dependence on the Nasdaq index. If this dependence continues, bitcoin and ethereum will lose value. In addition, it is important for bitcoin to stop associating itself with the blockchain. This cryptocurrency must be more like gold than part of the technology sector in order to become a global reserve asset.

Pizzino emphasized that the growth in the value of the flagship cryptocurrency by 25 times looks fantastic at the moment. However, the asset price increased 22 times between December 2018 and November 2021, so nothing is impossible in such a rally.

Chainalysis experts indirectly confirmed Jason Pizzino's bullish sentiment. According to them, crypto investors earned $162.7 billion in 2021, which is 400% more than in the previous year, 2020 ($32.5 billion). This happened because the prices of the two main cryptocurrencies, bitcoin and ethereum, rose to record levels. At $76.3 billion, ethereum outperformed bitcoin, which brought in $74.7 billion to investors. American investors earned the most, making a profit of $47 billion, which is more than their colleagues from the UK, Germany, Japan and China. By comparison, British savers earned "only" $8.2 billion.

And at the end of the review, some news from the world ... of books and movies. Firstly, the film company Scott Free Productions intends to film the book The Infinite Machine, dedicated to ethereum and Vitalik Buterin. It was written by Camilla Russo, a well-known journalist in the crypto industry. The movie will be co-produced by such a Hollywood luminary as Ridley Scott, known for his work on the blockbusters Alien, Gladiator, Blade Runner and The Martian.

Another newsmaker of the week was former stockbroker Jordan Belfort. Recall that this American entrepreneur pleaded guilty to stock market fraud and stock scams in 1999, for which he served 22 months in prison. He published a memoir in 2007, The Wolf of Wall Street, which was adapted into a film of the same name in 2013. And now this financial ?wolf? admitted that he himself was recently robbed of about $300,000 worth of crypto assets. He saw the transfer of funds, but could not cancel the transaction. The irony of fate...


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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#117 - May 01, 2022, 01:48:27 PM

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April Results: NordFX TOP-3 Traders' Earnings Exceed 230,000 USD

Daily Market Analysis from NordFX in Fundamental_mUSqpAj

NordFX Brokerage company has summed up the performance of its clients' trade transactions in April 2022. 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 highest profit this month was received by a client from Southeast Asia, account No.1620XXX, who earned 146,396 USD on gold (XAU/USD) trades.

The second place on the podium was taken by a trader from South Asia, account No.1621XXX, with a result of 64,004 USD, which was achieved thanks to transactions with the British pound (GBP/USD).

The third place belongs to the owner of account No. 1619XXX. Having chosen gold (XAU/USD), silver (XAG/USD) and euro (EUR/USD) as trading instruments, they made a profit of 21,184 USD.

The situation in NordFX passive investment services is as follows:

- CopyTrading still has an active provider under the nickname KennyFxPro. Signal with the complex name KennyFXPRO - Journey of $205 to $5,000 has shown a profit of 225% since March 2021 with a maximum drawdown of 67%. As before, almost all trades were made with NZD/CAD, AUD/CAD and AUD/NZD pairs. Such a famous pair as EUR/USD got only 0.19% in their arsenal. Another signal from the same supplier, KennyFXPRO-Prismo 2K is two months younger than the first one. The profit on it is less, 128%, but the drawdown was also lower, about 45%.

Among the newcomers, we can note the Darto Capital signal, which showed a yield of 197% in just 17 days with a maximum drawdown of 25%. This result is, of course, impressive. However, this is a fairly aggressive trading style, so subscribers should be as careful as possible and not forget about risk management.

- The TOP-3 in the PAMM service has not changed over the past month. The leader is still the same manager under the nickname KennyFXPRO. They increased their capital on the KennyFXPro-the Multi 3000 EA account by 100% in 462 days with a fairly moderate drawdown of less than 21%. TranquilityFX-The Genesis v3 account, which showed a 72% profit in 393 days with a similar maximum drawdown of less than 21%, and NKFX-Ninja 136, which has generated 60% income since June 11, 2021, with the same drawdown of about 21%, are also among the leaders. As in CopyTrading, the vast majority of trades here were made with the NZD/CAD, AUD/CAD and AUD/NZD pairs.

The Ultimate.Duo-Safe Haven account, which started relatively recently, at the end of February, attracted attention. During this time, it brought not the biggest profit of 17%, but the maximum drawdown on it did not exceed 20%.

Among the IB partners, NordFX TOP-3 is as follows:
- the largest commission, 4,683 USD, was credited to a partner from South Asia, account No.1582ХXХ;
- the next is their compatriot, account No.1565XXX, who received 4,529 USD;
- and, finally, a partner from East Asia, account No.1336XXX, who received $4,031 as a reward, closes the top three.

***

Summing up the results of the month, it should be reminded that traders have received another great opportunity to earn money. Another super-lottery for NordFX clients has started this year. There will be 200 cash prizes of 250, 500 and 1,250 USD, as well as 2 super prizes of 10,000 USD each. The total prize pool is exactly 100,000 USD.

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.

#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #cryptocurrencies #bitcoin #stock_market
#118 - May 06, 2022, 05:20:59 PM

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Forex and Cryptocurrencies Forecast for May 09 - 13, 2022


EUR/USD: A week of Many Multi-Year Records

Although some hotheads, such as James Bullard, the head of the Federal Reserve Bank of St. Louis, believed that the interest rate could be raised by 0.75% straight away, everything happened as the market expected. Following the May 4 meeting, the FOMC (Federal Open Market Committee) raised the federal funds rate by 0.5% to 1.0%. This increase was the largest since May 2000, as the US Central Bank has been changing the rate in steps of 0.25% for the last 22 years.

According to the US Federal Reserve, the key interest rate will continue to rise, as the labor market remains quite strong, and inflation is high, reaching its highest levels in 40 years. The regulator also decided to start a ?quantitative tightening? from June 1. The pace of the Fed's balance sheet drawdown could rise from $35 billion in June to $65 billion in July, and then to a maximum of $95 billion per month starting in August.

At the same time, Fed Chairman Jerome Powell said in his comments that the Central Bank is not considering an active increase in interest rates by 0.75% at the upcoming meetings. These words eased concerns about the accelerated pace of monetary tightening, which pushed Treasury yields off their highs. The market felt that the Fed was not aggressive enough, and trading on US stock exchanges on Thursday, May 05 ended with a rise, pulling cryptocurrency quotes along with it.

However, the jubilation of risk asset advocates was short-lived. The very next day, on the morning of May 06, the DXY dollar index reached a multi-year high, rising above 104.00. The last time it climbed this high was 20 years ago.

A massive, wide-ranging sell-off began in the stock and treasury bond markets. Technology stocks were particularly hard hit. The S&P 500 fell 4% to its lowest level since May 2021, while the NASDAQ Composite lost over 5%. At the same time, 10-year Treasury yields rose to their highest level since 2018, rising above 3%.

Some experts called the event "a tug of war between the bond market, which wants more aggressive action by the Fed, and the stock market, which wants the Fed to act more moderately."

Despite the growth of the DXY Index, the EUR/USD pair behaved quite calmly. It has been moving in the side channel 1.0470-1.0640 since April 27, which periodically narrowed to 1.0500-1.0580. In addition to the expected results of the Fed meeting, which had already been included in the quotes, and Jerome Powell's comments, data from the US labor market, received on Friday, May 06, could have brought some revival. However, such an important indicator as the number of new jobs outside the US agricultural sector (NFP) remained unchanged at the level of the previous month, 428K. As a result, the pair hesitated a bit and ended the five-day period in the central zone of the named channel: at the level of 1.0540.

A former senior US Central Bank official suggested earlier that the federal funds cost rate could eventually reach 5.0% after a series of increases. If the market decides it will, the dollar's bullish rally will continue and it could reach 1:1 parity with the euro. In the meantime, analysts' voices are divided as follows: 75% are sure that the dollar will continue to strengthen, while only 25% have the opposite opinion. 90% of trend indicators and 85% of oscillators on D1 which are colored red side with the dollar, respectively, 10% and 15% are colored green. Immediate support is at 1.0500, followed by the April 28 low at 1.0470, the next bearish target for EUR/USD could be the 2016 low of 1.0325.  The nearest resistance zone is 1.0570-1.0600, then there are zones 1.0750-1.0800, 1.0830-1.0860, 1.0900-1.0935 and 1.1000.

There will be few significant economic events next week. The calendar could mark Wednesday May 11 and Friday May 13 when the data for the German and US consumer markets come in. Also, changes in the number of applications for unemployment benefits in the United States will become known at the very end of the working week. And we should not forget about the active hostilities that are taking place in Ukraine, in the immediate vicinity of the EU borders, and the ?surprises? that the Kremlin may present in response to sanctions imposed on by the European Union.

GBP/USD: Score 1.0-1.0 What's Next?

It was not only the Fed, but also the Bank of England that set a record last week. It raised the interest rate by 25 basis points to 1.0% at its meeting on Thursday, May 04, which is the highest level since 2009. Moreover, 3 out of 9 MPC (Monetary Policy Committee) members of the Bank voted for raising the rate to 1.25% straight away. The number of votes against the rate hike is 0. In addition, it became known that the regulator of the United Kingdom is working on a plan to sell government bonds purchased after the crisis, which currently stand at just under ?850 billion.

The Bank of England also sharply raised its inflation forecast for 2022, from 5.75% to 10.25%. (Recall that in March, inflation peaked since 1992 and amounted to 7% (y/y) with a target level of 2%). The main reason is the rise in fuel and transport prices. In April alone, fuel bills in the UK skyrocketed by 54%, and this is not the limit. In addition to the consequences of Brexit and the COVID-19 pandemic, the situation is aggravated by sanctions against Russia due to its invasion of Ukraine, and new coronavirus lockdowns in China. Inflation forecast for 2023 was also changed for the worse: from 2.5% to 3.5%.

Economic forecasts did not please investors either. And although the Bank of England left its forecast for GDP growth for the current year (+3.75%) unchanged, a recession is expected starting from the Q4. British Central Bank expects GDP contraction by 0.25% In 2023 instead of the previously planned growth of 1.25%. According to the new forecast, GDP will grow not by 1.0%, but by only 0.25% in 2024.

The interest rates of the US Federal Reserve and the Bank of England have reached the same level of 1.0% at the moment. However, if the dollar rate may reach 3.0-3.5% at the beginning of next year, or even higher, the British regulator suggests an increase in the pound rate to 2.5% by mid-2023. and its decline to 2.0% by the end of the forecast 3-year period. Such a difference in the pace of monetary tightening is likely to continue to put pressure on the British pound. However, the Fed should also update its inflation forecasts in June, and things could change.

In the meantime, the GBP/USD pair continued to fall, returning to June 2020 levels and reaching a local bottom at 1.2275. As for the final chord, it sounded at the height of 1.2340;

55% vote for further weakening of the British currency, 30% expect the pair to correct to the north and 15% - to move to the east. As for the indicators on D1, there is still a total advantage of the red ones: 100% both among the trend indicators and among the oscillators look down, although 10% of the latter are in the oversold zone. The nearest targets of the bears are to overcome the support at 1.2250, then at 1.2075, a strong point of support for the pair is at the psychologically important level of 1.2000. As for the bulls, if they manage to seize the initiative, they will face resistance in the zones of 1.2400, 1.2470-1.2570, 1.2600-1.2635, 1.2700-1.2750, 1.2800-1.2835 and 1.2975-1.3000.

Among the statistics related to the economy of the United Kingdom, the most interesting are the data on the country's GDP, which will be released on Thursday May 12.

USD/JPY: Bulls' Target Is 135.00

The correlation between 10-year US Treasury bills and the USD/JPY currency pair has not been canceled. If the yield of these securities grows, the dollar rises against the Japanese yen. We have seen confirmation of this in the past week. The pair reached a high of 130.80 on May 06 and is now aiming for a new 20-year high of 1.3125. Strategists of the international financial group Nordea expect that it may reach 135.00 by the end of the year. The strengthening of the yen and the fall of the pair, in their opinion, can only be expected in the second half of 2023.

Japanese consumer prices excluding fresh food, a key indicator monitored by the Bank of Japan, rose 2.1% in April, surpassing the 2.0% target for the first time in many years. And if the yen breaks through the level of 140 per $1, inflation in Japan may reach 3.0%, according to BNP Paribas experts. However, the head of the Bank of Japan, Haruhiko Kuroda, has repeatedly stated that the Japanese regulator, despite the dissatisfaction of the population with rising prices, will remain faithful to the soft monetary policy.

If the Central Bank does decide to tighten it, this will make it difficult for the country to stabilize and reduce the ratio of public debt to GDP, according to Fitch Ratings. According to Fitch Ratings, this ratio reached 248% in fiscal year 2021, which is the highest among all investment-grade states and is the main credit weakness Japan. (For comparison, Italy, which is in second place, has a figure of about 150%).

The report on the latest meeting of the Monetary Policy Committee of the Japanese regulator will be published next week, more precisely on Monday May 09. However, it is unlikely to affect the balance of power between the dollar and the yen. The scenario in which the USD/JPY pair will continue its movement to the north is supported by 65% of experts, 35% are waiting for movement to the south. 100% of trend indicators and oscillators on D1are looking north, but 15% oscillators signal that the pair is overbought. The nearest support is located at 129.70-130.15, followed by zones and levels 128.60-129.30, 127.80-128.00, 127.00, zone 126.30-126.75 and levels 126.00 and 125.00. The bulls' target is to renew the April 28 high at 131.25. An attempt to designate the subsequent targets of the bulls will rather be like fortune telling. The only thing that can be assumed is that they will set the January 01, 2002 high of 135.19 as their goal.  If the pair's growth rate is maintained, it can reach this height as early as in June.

CRYPTOCURRENCIES: It All Depends on the Fed

Daily Market Analysis from NordFX in Fundamental_5PMReKV

A recently published report by the analytical company DappRadar demonstrates the growth of crypto activity in the US, Russia and Ukraine. And if the increase in demand for digital assets is due to sanctions and a humanitarian catastrophe in the last two states, respectively, the global acceptance of virtual money in the United States is the result of an increase in the number of traders and crypto companies. At the same time, DappRadar analysts note that the popularity of cryptocurrencies has increased not only in the above countries, it has happened all over the world. For example, against the background of the threat of global inflation, the demand for virtual money in Brazil and India has increased by 40% and 45%, respectively. According to some experts, the number of cryptocurrency users will increase 5 times over the next 10-20 years and reach more than 1 billion people.

The specialists note that it is the activity of small investors who continue to believe in the future rise of bitcoin that saves it from a deep drawdown at the moment. Thus, the owners of wallets from 0.1 BTC to 10 BTC doubled their positions in April alone, bringing the total stock to 2.5 million BTC.

As for institutional investors (with investments of more than $1 million), the dynamics here are the opposite and it is primarily due to the actions of the US Federal Reserve. The Central bank has printed more than a third of the new dollars since spring 2020, and its balance sheet has doubled to $9 trillion. While the Fed flooded the market with cheap money, a huge amount of it was invested by investors in risky assets, supporting the stock and cryptocurrency markets. the time has come now to tighten monetary policy, which could not but affect these assets. As a result, the net outflow of investments from crypto funds has reached an all-time high of 14,327 BTC. Moreover, American investors are most active in getting rid of bitcoins, having reduced the volume of investments by 11% in a month. (And this despite the fact that the number of traders and crypto companies in the US is growing).

At the time of writing this review, Friday evening, May 06, the total crypto market capitalization is at $1.657 trillion ($1.752 trillion a week ago). The Crypto Fear & Greed Index has slightly worsened its readings: it dropped by 1 point, from 23 to 22 points, gaining a foothold in the Extreme Fear zone. The BTC/USD pair is trading around $36.100, the week low was fixed at $35.280.

A further rise in interest rates, along with unloading the Fed's balance sheet, the growth of the DXY dollar index and the yield of treasuries, continue to put pressure on the quotes of risky assets. If about 50% of all BTC coins in circulation were profitable for their owners in the middle of the week, this figure will become smaller as quotes continue to fall. So, only 40% of the coins will remain profitable at the level of $33,000, which can cause an avalanche increase in panic.

Trader and Factor LLC CEO Peter Brandt predicts that bitcoin will test the $28,000 level. The expert drew attention to the pattern that the price of the first cryptocurrency has formed since the beginning of the year, and the breakdown of its lower border. ?The completion of a bearish channel usually results in a decline equal to its width. In this case, in a hard test of $32,000 or so, but I think $28,000,? Brandt commented.

Another reputable cryptocurrency trader, Benjamin Cowen, also believes that there should be a major capitulation of bitcoin before a bullish reversal begins. According to him, it will spur another round of a bullish rally. Drawing a possible downside scenario, Cowen noted the three most important long-term moving averages that keep BTC at the level of support for a multi-year growth trajectory: 300-, 200- and 100-week SMA. A drop below the 100-week SMA has historically been a great opportunity for bulls: ?The 100-week SMA is around $36,000 now, and there is an optimal time to buy BTC every time it goes below it,? Cowen said. But if the fall gains strength, the BTC rate, in his opinion, may collapse even more and test the level of the 200-week moving average, $21,600. ?Many people do not believe that this can happen,? the trader says, ?but it is possible. I used to buy BTC at $6,000 and then the rate fell to $3,000. Then I bought BTC at $7,000 and $10,000 and the rate fell again to $3,800. So this has happened before and can happen now.?

Bitcoin?s 300-week moving average was briefly touched only once during the COVID-19-driven market crash in March 2020, and Cowen doesn?t expect a repeat of the same.

Arthur Hayes, former CEO and co-founder of BitMEX, predicted in April that bitcoin would fall to $30,000 at the end of the first half of the year. He attributed this to a possible decline in the Nasdaq index, with which digital gold is highly correlated. Analysts at Arcane Research confirmed that this statistical relationship is at its highest since July 2020.

However, fintech experts who took part in the Finder survey expect quotes of the leading cryptocurrency to be above $65,000 at the end of the year with subsequent growth. Hayes himself does not doubt the prospects of bitcoin, predicting a rise in the price of the coin to $1 million by the end of the decade.

Unlike Arthur Hayes and Benjamin Cowen, analyst Michael van de Poppe thinks the network data hints at a possible bullish reversal in bitcoin. According to him, ?BTC hash rate has reached another all-time high, although there is a tightening in the cryptocurrency space. Thus, the demand for BTC mining is growing, the network is becoming safer, and the asset price should respond to this.?

According to van de Poppe, a serious impulsive wave can be expected due to a possible correction in the US dollar index (DXY). ?In my opinion, a serious move up is quite possible, especially if the US dollar shows weakness,? the analyst said. ?In the event that the Fed abandons a strong tightening of monetary policy, the dollar will weaken, and this will become the impetus for the upward movement of bitcoin.?

Mike McGlone, Senior Analyst at Bloomberg Intelligence, has similar hopes. He hopes that a sharp fall in the stock market will force the US Federal Reserve to change its position on tightening monetary policy, which will provoke bullish runs in high-risk assets. ?The Fed will continue its policy until the stock market drops enough to force the regulator to pause. That's when I think we'll see the rise of bitcoin, ethereum and maybe Solana."

?If you want a good downside indicator for bitcoin and altcoins, these are Fed Funds futures. This is what the market expects from the Fed in a year. They are valued at 3% right now, maybe more, and the actual rate is 1%. As soon as this forward expectation starts to decrease, I think that bitcoin will hit the bottom,? the analyst said.


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
#119 - May 08, 2022, 05:07:19 PM

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Forex and Cryptocurrencies Forecast for May 16 - 20, 2022


EUR/USD: On the Way to 1.0000

Daily Market Analysis from NordFX in Fundamental_Y1LWsbC

The dollar continues to rise, while the EUR/USD pair continues to fall. The DXY dollar index crept close to 104.9 on Thursday, May 12. The last time it climbed this high was 20 years ago. The pair found the bottom at the level of 1.0349, in the area of the lows of December 2016 - January 2017. A little more, and following DXY, it will get to where it traded 20 years ago. And there, parity 1:1 is just a stone's throw away.

The reason for the next strengthening of the US currency was, as usual, two factors: the recovery of the labor market and the growth of inflation. It is these factors that determine the pace of tightening monetary policy by the Fed.

According to the forecast, US jobless claims should have shown a slight increase. But the actual data, released on Thursday May 12, showed that the situation in the labor market is much better than expected. The number of initial requests has grown, but not by 3K, as predicted, but only by 1K. The number of repeated requests, instead of increasing by 3K, decreased by as much as 44K.

A day earlier, on May 11, inflation data appeared. The core consumer price index in the US increased by 0.3% in April and amounted to 0.6%. This growth is much less than the 1.2% increase in March. But this does not mean at all that inflation in the country has reached a peak and will only decrease further. Not at all. Oil prices remain above $100 a barrel, pushing up the cost of goods, transportation costs and household spending. New cars increased in price by 1.1% in April (only by 0.2% in March), while airfare prices rose by 18.6% over the month, showing the largest increase in 60 years. In addition, with a high degree of probability, a series of lockdowns in China due to a new wave of coronavirus will lead to problems with logistics and commodity exchange, which will not help reduce inflation either.

The combination of these factors suggests that the US Federal Reserve is unlikely to change its plans to tighten monetary policy: to reduce the balance sheet and raise rates. Following the head of the regulator Jerome Powell, his colleagues in the FOMC - the head of the Federal Reserve Bank of Cleveland Loretta Mester and the head of the New York Fed John Williams supported the intention to raise the federal funds rate by 0.5% at each of the two upcoming meetings, bringing it to 2.0%.

As for their counterparts on the other side of the Atlantic, the ECB's key figures advocating a start to raise interest rates are still in the minority. Most members of the Board of Governors of the Bank are still convinced that the increase in inflation in the Eurozone is a temporary phenomenon, caused primarily by rising energy prices due to sanctions against Russia, which invaded Ukraine.

As a result, a powerful divergence between the clearly hawkish position of the US Fed and the indistinctly dovish position of the ECB continues to push the EUR/USD pair down, forcing new multi-year lows.

At the moment, analysts' voices are divided as follows: 70% of analysts are confident that the dollar will continue to strengthen, the remaining 30% are waiting for the pair's correction to the north. At the same time, when switching from a weekly to a monthly forecast, the number of those voting for the growth of the pair increases to 80%.  All 100% of the indicators on D1 side with the dollar, after another fall of the pair. However, 20% of oscillators are in the oversold zone. The nearest resistance is located in the zone of 1.0420, the next target of the bulls on EUR/USD is a return to the zone of 1.0480-1.0580. If successful, they will then try to break through the resistance at 1.0640 and rise to the zone of 1.0750-1.0800. For the bears, the number 1 task is to update the May 13 low of 1.0350, after which they will storm the 2017 low of 1.0340, below are only the support of 20 years ago.

As for the calendar for the coming week, we recommend paying attention to the publication of data on prices and volumes of retail sales in the US on Tuesday, May 17. The speeches of the heads of the ECB Christine Lagarde and of the Fed Jerome Powell are expected on the same day. The Eurozone Consumer Price Index will be known on Wednesday, May 18, and data on manufacturing activity and the state of the labor market in the United States will be received on Thursday, May 19.

GBP/USD: GBP Rate Hike Is Possible, But Not Obvious

As mentioned above, the DXY dollar index has reached 20-year highs. According to experts, it has risen by 5.1% over the past 4 weeks. At the same time, the GBP/USD pair fell 7.4%, outperforming the average by 2.3%. However, not everything is so bad for the British currency.

The Bank of England predicted a rise in inflation from the current 7.0% (30-year high) to 10.25% at its meeting on May 05. And although the regulator left the forecast for GDP growth for the current year unchanged (+3.75%), it expects a recession starting from the Q4. The British Central Bank expects a 0.25% reduction in GDP in 2023 instead of the previously planned growth of 1.25%. According to the new forecast, GDP will grow not by 1.0%, but by only 0.25% in 2024.

This scenario, of course, cannot be called optimistic. However, a week later, on May 12, statistics showed that the country's GDP in the Q1 rose by 8.7% year-on-year, seriously exceeding the previous figure of 6.6%. This dynamics gives investors hope that the regulator will not stop at the current interest rate of 1.0%, and like the Fed, it will go on further raising it in order to fight inflation. And this, in turn, will support the British currency. Or at least keep it from sliding further down.

GBP/USD hit a weekly low at 1.2154, with the last chord at 1.2240. In case of further correction to the north, the pair will have to overcome the resistance in the zone 1.2300-1.2330, then there are zones 1.2400, 1.2470-1.2570, 1.2600-1.2635, 1.2700-1.2750, 1.2800-1.2835 and 1.2975-1.3000. When moving south, the first support will be the level of 1.2200, then 1.2154-1.2164 and 1.2075. A strong point of support for the pair is at the psychologically important level of 1.2000. 85% of experts vote for further weakening of the British currency, 15% expect a rebound upwards. And here it should be noted that when switching to forecasting until the end of the June, the number of the pair's growth supporters increases to 75%. There is still a total advantage of the red ones among the indicators on D1: 100% among trend indicators and 90% among oscillators look down. The remaining 10% among the latter have turned north.

As for the events of the upcoming week concerning the economy of the United Kingdom, we can highlight the publication of data on unemployment and wages in the country on Tuesday May 17. The new value of the Consumer Price Index will become known on Wednesday, May 18, and retail sales in the UK for April at the end of the working week, on Friday, May 20.

USD/JPY: From Return on Capital to Its Safety

The Japanese yen performed better last week than its "colleagues", the euro and the British pound. As most experts expected, the bulls tried to renew the April 28 high at 131.24. However, having risen only 10 pips higher to 131.34, they gave up, and the USD/JPY pair flew down, finding support only at 127.51. Undoubtedly, the current volatility of the pair is impressive: the weekly trading range was 383 points. This is despite the fact that it hovered around 150 points on average  in the Q4 2021 - the Q1 2022. The finish of the last week took place in the central zone of the indicated range, at the level of 129.30.

Barring volatility during the coronavirus pandemic, the USD/JPY drop on Thursday May 12 was the biggest one-day swing since 2010.  The strengthening of the Japanese currency, according to a number of experts, was due to the increased craving of investors for the most risk-free assets. Up to this point, the dollar has risen on the back of rising interest rates and higher yields on 10-year US Treasury bills.  However, if investors continue to prefer capital preservation over returns, USD/JPY will continue to fall.

The yen was also strengthened by the expectation of changes in the policy of the Bank of Japan. Many investors, especially foreign ones, are expecting that, despite the regulator's assurances of commitment to an ultra-soft monetary policy, it may still go for an increase in interest rates. Moreover, there have already been such precedents, albeit in the opposite direction. Markets remember 2016, when the head of the Central Bank, Haruhiko Kuroda, first denied the possibility of introducing negative rates categorically, and then suddenly decided to take such a step.

At the moment, experts' forecasts look as uncertain as the pair's quotes. 40% vote for its growth, 50% are in favor of the fall of the pair and the remaining 10% have taken a neutral position. There is a similar discord among the indicators on D1. As for trend indicators, 65% are green, 35% are red.  The oscillators have 40% on the green side, 25% on the red side, and 35% hve turned neutral gray. The nearest support is located at 128.60, followed by zones and levels at 128.00, 127.50, 127.00, 126.30-126.75, 126.00 and 125.00. The goal of the bulls is to rise above the 130.00 horizon and renew the May 05 high at 131.34. The January 1, 2002 high of 135.19 is seen as the final goal.

Data on Japan's GDP for the Q1 of this year will be published next week, on Wednesday, May 18. It is expected that this indicator will decrease by 0.4% from the previous value of 1.1%.

CRYPTOCURRENCIES: "$1 Million per BTC, or Zero"

If you read the headlines of the last week, you get the strong impression that the cryptocurrencies have only a few months left to live, if not days. ?Crypto Market Massacre?, ?Bitcoin Requiem?, ?Crypto Bubble Burst? are just some of them. But is it all that scary?

Indeed, the market suffers very serious losses. Bitcoin has lost about 45% of its value since the end of March, hitting $26,580 on May 12. Most other coins feel even worse. As has been said many times, the cause of panic is the global drop in investor risk appetite. The crypto market only follows in the wake of the stock market: the correlation between digital asset quotes and stock indices S&P500, Dow Jones and Nasdaq is at its maximum.

The tightening of the monetary policy of the US Federal Reserve, new outbreaks of coronavirus in China, fears about the future of the EU economy: all this has led investors to prefer the dollar over risky assets. An additional driver is rising yields on 10-year US Treasury bonds. This figure has almost doubled since March and rose over 3%: to the highest level since 2018, exceeding the returns of most sectors of the US stock market.

In addition to global factors, the collapse of the third largest stablecoin in terms of capitalization, UST, put additional pressure on the crypto market. It is believed that stablecoins serve to facilitate investment transactions and should be pegged to the real dollar in a ratio of 1:1. The price of UST immediately collapsed to $0.64, casting doubt on the ability of the Terra team to maintain its rate. Against the backdrop of problems with UST, the native Terra LUNA token also went down, losing more than 90% of its price. It cost about $120 back in April, but you can buy it for $5 now. And here it must be borne in mind that the Terra blockchain protocol is a fairly large project that was in the TOP-10 in terms of market capitalization.

The fate of the centralized stablecoin Tether with a capitalization of $82 billion causes some concern as well. An audit of this project conducted in 2021 showed that instead of dollars, which should provide a reserve for the project, there are a lot of securities in the accounts. Against this background, the sale of USDT has intensified: its capitalization has decreased by $1.4 billion in recent days.

The total capitalization of the crypto market continues to fall. At the time of writing this review, Friday evening, May 13, it is at $1.290 trillion ($1.657 trillion a week ago). The Crypto Fear & Greed Index has fallen from 22 to 10 points out of 100, firmly entrenched in the Extreme Fear zone. The BTC/USD pair, after a slight upward rebound, is trading around $30.150. The low of the week, as already mentioned, was fixed at $26.580. The last time the pair was so low was in December 2020.

The number of "whales" among bitcoin holders, whose capital exceeds the bar of 1000 BTC, is rapidly declining. This figure has already reached its lows since the beginning of the year. At the same time, the volume of cryptocurrency on the exchanges, on the contrary, is at its maximum over the past three months. According to Glassnode analysts, the average volume of coin inflows to centralized exchanges is now hovering around 1755 BTC.

Galaxy Digital founder Mike Novogratz expressed doubt that the bulls will be able to defend the $30,000 support levels for bitcoin and $2,000 for ethereum. ?Until we reach a new equilibrium,? he wrote, ?digital assets will continue to trade in close correlation with the Nasdaq. Intuition tells us that there will still be a drawdown ahead, and this will occur in a very unstable, volatile and complex market.? Mike Novogratz warned that the negative scenario could materialize if the Nasdaq index falls below 11,000 (it hit 11,688 on May 12).

Gold apologist, billionaire Peter Schiff, predicted the main cryptocurrency to collapse below $10,000. And another billionaire veteran of the bitcoin industry, 2020 US presidential candidate Brock Pierce said in an interview with Fox Business that it can be very successful, but it can also fail. ?Bitcoin could drop to zero. Here is the binary result. Either there will be $1 million per BTC, or zero,? he said.

Pierce believes that the current ?cryptocurrency landscape? is very similar to the history of the tech companies' bubble. ?The situation is very similar to 1999. The market is now in the same phase. So what happened then? After the dot-com bubble, eBay, Amazon and other interesting companies appeared, but a lot of businesses went bankrupt. But this does not mean that digital assets are unrealistic and will not play an important role in our collective future,? the billionaire said. Pierce admitted that he diversified his portfolio, primarily through Ethereum. He also placed a ?nine zeros? bet on EOS, converting all of his Block.one shares into cryptocurrency.

Unlike other influencers, ARK Invest CEO Katherine Wood continues to express sustained optimism and believes that the growing correlation between cryptocurrencies and traditional assets indicates that the bearish trend will end soon. The businesswoman opined that the depreciation of bitcoin along with the traditional market is a temporary phenomenon: ?Cryptocurrency is a new asset class that should not follow the Nasdaq, but that is what is happening. We are currently in a bearish trend where all assets are moving in the same way and we are seeing one market after another capitulate, but cryptocurrencies may be close to completing it.?

The head of ARK Invest believes that the cryptocurrency market will grow exponentially as traditional assets collapse. ?The current recession in the stock and bond markets, commodities and cryptocurrency markets is causing negative sentiment among investors. But look at our research? I can?t even tell you how confident we are that our products will change the world and are already on an exponential growth trajectory.? According to Wood, blockchain is in a technology sector that will grow more than 20 times in the next seven to eight years.

Another hope for investors is that bitcoin is already halfway to its next halving. It happened at block number 735,000 on May 05. This event occurs every 210 thousand blocks, or approximately once every four years, with a little less than 105 thousand blocks left until the next one. The halving date can be predicted to within a couple of days, because the block production time fluctuates around 10 minutes. The previous halving took place on May 11, 2020, and the next one will take place approximately in April 2024.

Halving cycles are one of the main mechanisms of the bitcoin network, which involves halving the BTC reward for miners. Accordingly, the issue of bitcoins is also halved, since miners' rewards are the only source of issuing new coins. From the inception of bitcoin to the first halving, miners were rewarded with 50 BTC per block. Then the amount in bitcoins was reduced to 25 BTC, and in the next cycle to 12.5 BTC. Currently, miners receive 6.25 BTC for mining a block.

And if miners suffer losses due to halving, investors, on the contrary, earn. As observations show, before the first halving, BTC cost about $127, before the second, its price rose to $758, and before the third, to $10,943. It remains to wait for not so long, less than two years, to find out whether there will be a similar explosive rise in the price of BTC in 2024.


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
#120 - May 15, 2022, 07:31:40 AM

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