Daily market analysis by NordFX

[Stan NordFX]

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.

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[Stan NordFX]

USD/JPY: Markets Have Chosen the Dollar

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.

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[Stan NordFX]

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.

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[Stan NordFX]

CryptoNews of the Week

- The Committee on Economic and Monetary Affairs of the European Parliament (ECON) adopted a bill on the regulation of cryptocurrencies by a majority of votes. “It is a good day for the crypto sector," said one of the drafters of the law. “The EU Parliament has paved the way for innovative regulation of cryptocurrencies that could set standards for the world.” 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.

- Analytical company Elliptic said that it transferred to the US authorities some 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 the latest data, large investors from Russia kept their cryptocurrency holdings on exchanges located in Switzerland. They expected that Switzerland, being a neutral country, would not be involved in any conflicts, so their digital assets were safe. 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 convert them into cash.

- MicroStrategy CEO Michael Saylor is known to be an ardent supporter of bitcoin. His company owns several billion dollars’ worth of cryptocurrencies. Sailor himself is confident that BTC will grow in price, as this asset forms a new financial system. During his recent speech at the Economic Club of New York, he compared cryptocurrencies to real estate that an investor purchases in an American metropolis. In the context of rising inflation, real estate retains the status of a reliable and profitable asset. In this regard, bitcoin can also be considered a safe-haven asset that is not subject to inflation risks.

– Elon Musk agreed with Michael Saylor. His tweet referred to an article in the Financial Times about the rise in prices in commodity markets to highs since 2008 amid fears of cutting off the supply of raw materials from Russia and concluded that it is better to invest in physical assets and cryptocurrencies. “Buy a house or shares of a company that makes good products. By the way, I personally still hold bitcoin, ethereum and Dogecoin,” wrote the head of Tesla and SpaceX.

- Peter Brandt, a well-known trader and analyst, a Wall Street legend, recommended almost the same thing to his more than 600,000 subscribers. According to news.bitcoin, he advised young people to "get a degree in their field, avoid student debt if possible, get a decent job, and think of the markets as a hobby." In addition, in his opinion, young people should be frugal, buy a house and start a family, and also invest part of their savings every month in bitcoin and in stocks of serious companies, while remaining hodlers.

– According to Bill Barhydt, CEO of Abra crypto-bank, a steady decline 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.

- According to analysts from IntoTheBlock, despite the fact that the price of bitcoin is far from the historical high, the number of holders of the flagship cryptocurrency has reached a record value. 39.79 million unique addresses keep these digital coins on their balances at the moment. This suggests that about 888 thousand new BTC holders have joined the network since the beginning of this year.
According to experts from Finbold, the number of holders holding less than 1 BTC on their balance sheet has increased significantly since October 2020. At the same time, whales (from 1000 to 10,000 BTC) have not increased their holdings much. According to the analysts, this suggests that bitcoin is unlikely to show serious growth in the medium term.
Representatives of the CoinMarketCap service do not agree with them. The portal'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.

- Citizenship of Saint Kitts and Nevis can now be purchased with cryptocurrency. It is a small island nation in the Caribbean. The country is part of the British Commonwealth, and Queen Elizabeth II of Great Britain is recognized as its head. The program for obtaining citizenship in exchange for investments has been operating in the country for a long time, since the 1980s. The current amount of investment, which allows you to get the coveted passport, is $150,000. But if earlier the country accepted only the traditional currency, now the list has expanded: investors can transfer about 4 BTC at the exchange rate to Saint Kitts and Nevis.
By the way, some well-known supporters of digital assets already have the citizenship of this country. One of the most recognizable is Roger Ver, the developer of Bitcoin Cash (BCH).

- Cryptocurrencies have proven to be an effective weapon against Russia, ConsenSys founder and ethereum co-creator Joseph Lubi said in an interview with Decrypt. The international crypto community has donated more than $100 million to Ukrainian charitable foundations since the beginning of the Russian military invasion of Ukraine.
According to Joseph Lubi, the war in Ukraine predetermined the further integration of digital assets into the global economy: “This is another moment for our industry that will allow for mass adoption [of cryptocurrencies]. This will be a matter of national security now,” he said. “Our country and many others will have to learn how to use this powerful tool, this weapon. Nobody likes guns, but you need to be able to handle them like your neighbors do."

- Apple co-founder Steve Wozniak believes bitcoin will be worth $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. Bitcoin’s upward rally in 2021 was fueled by fears that the Federal Reserve would “print money forever,” he said. Now that the Fed is winding down its stimulus program, the largest cryptocurrency is in the middle of a bearish trend.


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

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

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[Stan NordFX]

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.

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[Stan NordFX]

USD/JPY: Yen Falls to Six-Year Low

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.

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[Stan NordFX]

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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[Stan NordFX]

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

EUR/USD: A Tangle of Chaos and Paradoxes

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.

continued below...

 

[Stan NordFX]

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

https://nordfx.com/

 

[Stan NordFX]

CryptoNews of the Week

- US Treasury Secretary Janet Yellen spoke about the importance of digital assets in an interview with CNBC. “Cryptocurrency has grown by leaps and bounds, and now it plays a significant role not only in transactions, but in the investment decisions of many Americans,” she said.
At the same time, Ms. Minister confirmed her concerns regarding digital assets due to threats to financial stability, the need to protect private investors and the use of cryptocurrencies in illegal activities. “On the other hand, cryptocurrencies have advantages, and we recognize the benefits of innovation in the payment system. We want to issue recommendations to create a regulatory field in the long run,” she concluded, referring to the March executive order of US President Joe Biden. Recall that this decree requires federal agencies to coordinate their efforts in regulating the cryptocurrency industry.

- Kevin O’Leary, an American entrepreneur and star of the popular business and finance show “Shark Tank” stated that “there is no chance that bitcoin or anything else that has economic prospects in terms of developing new technologies for financial services will be banned and payment systems.
Roy Niederhoffer, the founder of RGNiederhoffer Capital Management, disagreed with his opinion, and he sees the possibility of a ban. He recalled that there was a time when private ownership of gold was banned in many countries, including the United States.
In the end, both panellists agreed that regulation of the cryptocurrency space is inevitable, and it will lead to a massive rally. “As soon as we see regulation, organizations will start investing trillions of dollars in cryptocurrencies,” O’Leary is sure.

- Peter Brandt, a legendary trader and the Factor Trading CEO, tweeted to his 629,400 followers that BTC’s recent move reminded him of April 2019, when the top cryptocurrency bottomed at $3,500 and began 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 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. Note that this forecast met with no objections from Brandt.

- DataDash CEO Nicholas Merten believes that short-term investors and traders with leverage influence bitcoin volatility, and “whales” influence the growth. He clarified that “whales” and other institutional investors accumulating cryptocurrency, despite macroeconomic and geopolitical uncertainty, are the catalyst for the rise in the price of BTC.
“There has been a lot of panic around the macro environment over the past couple of months. The Fed raises interest rates... The war between Ukraine and Russia, the potential next wave of COVID-19: all these issues have caused investors to be pessimistic and make them think that investors and companies are going to sell bitcoins. At the same time, the “whales”, on the contrary, did not sell cryptocurrency in large volumes. In fact, we saw how long-term investors continued to either buy more or hold bitcoin,” Merten shared his observation.
As for volatility, “all the up and down price movements that we see in the market are most likely due to the liquidation of the positions of short-term traders and leveraged traders,” said the CEO of DataDash. In his opinion, despite a 50% drop in quotes from a record high of $69,000 in November, bitcoin has remained in a bull market all along.

- The conflict, during which American actor Will Smith hit comedian Chris Rock during the live broadcast of the Oscars, opened up a good opportunity for entrepreneurial members of the crypto community to make money.
Almost immediately after the end of the Oscars, there were reports on the network about the launch of a decentralized autonomous organization (DAO) named after this slap in the face: Will Smith Slap DAO. The project has its own website and pages in social networks. The organizers of Will Smith Slap DAO also launched the sale of non-fungible tokens (NFT) based on the slap, which have already been bought by over 500 people.

- Despite numerous macroeconomic and geopolitical challenges, bitcoin is highly likely to move into the second half of the bear market. This opinion is shared by Glassnode analysts.
The price of the first cryptocurrency broke through the upper limit of the three-month range at $47,000 last week. Active accumulation of coins in the $35,000-$42,000 range and the lack of significant spending of bitcoins purchased in the first quarter of 2021 increased the selling pressure.
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% over the past year. 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 warned that the process of bottoming and investor capitulation in a bear market is often lengthy and painful. They urged not to rush into stating the end of the bear market.

- Citizens School in Dubai (UAE), which is scheduled to open in September, will offer parents of students the opportunity to pay for their studies in bitcoins and ethereum. Payments will be accepted through a processing service that converts crypto assets into the local currency dirham.
“By introducing a new payment method, we expect the younger generation to play a stronger role in the development of the digital economy in the UAE. While many people are already enjoying the fruits of the new era, today's children will become the entrepreneurs and investors of the future,” says Citizens School management.

- Well-known software developer MicroStrategy 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. “This loan provides an opportunity to strengthen our position as a leader among public companies investing in bitcoin,” said Michael Saylor, CEO of MicroStrategy.
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.

- 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 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. This is confirmed by a new report from the analytical company Santiment. It states that whales have accumulated up to 23.7% of the total ethereum supply. They are not going to dump their reserves and prefer to send ETH to offline storage. A similar trend was observed in the first half of 2017. As a result, we saw the famous altcoin run during the hype five years ago.

- The next time someone tries to downplay Bitcoin (BTC) mining’s environmental achievements, feel free to cite the AmityAge mining farm as an example. Founded in Slovakia by Gabriel Kozak and Dušan Matuska, the company generates electricity for mining by using human and animal waste.,
One of its leaders, Dušan Matushka, said that "their devices run on methane, which is produced during the biodegradation process." Since there is no shortage of human and animal waste in the foreseeable future, we can say that BTC mining here is carried out in an environmentally friendly manner and using renewable energy sources.


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

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

https://nordfx.com/

 

[Stan NordFX]

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.

continued below...

 

[Stan NordFX]

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.

continued below...

 

[Stan NordFX]

CRYPTOCURRENCIES: What Whales and Short-Term Speculators Do

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 Dušan Matuska from Slovakia decided. As a result, they created the AmityAge mining farm, which runs on electricity obtained from human and animal waste. Dušan 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

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[Stan NordFX]

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

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

https://nordfx.com/

 

[Stan NordFX]

CryptoNews of the Week

- Miners mined the anniversary 19 millionth bitcoin On Friday, April 01. This event took place at block 730.002. At the time of writing, 90.48% of the total digital gold issue has been mined, which is limited to 21 million BTC.
According to the algorithm laid down by Satoshi Nakamoto, the reward is reduced by 50% every 210,000 blocks. The next halving is expected in 2024. (For reference: the 18 millionth coin was mined on October 19, 2019).

- The trend towards the accumulation of bitcoins among various market participants continued last week. Such well-known companies as Luna Foundation Guard and MicroStrategy are among them. 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%.
At the moment, miners have already mined 19 million coins out of the 21 million provided by the algorithm, and the accumulation has become many times higher than the emission. Thanks to this, bitcoin may soon become a scarce asset. 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. And this is despite the fact that the market has been under the pressure of the bears for most of this period.

- The German Federal Criminal Police confiscated the German servers of the Hydra darknet marketplace. 543 BTC were also seized as part of the international operation with a total value of about 23 million euros. The investigation into the case has been ongoing since August 2021 with the participation of the US authorities. Hydra operators and administrators are suspected of providing opportunities for drug trafficking, fraudulent documents and money laundering.
According to the police, the users of the darknet marketplace included about 17 million customers and more than 19 thousand sellers. Hydra accounted for 75% of all dark web revenue in 2020, at least 1.23 billion euros. The platform entered the top 10 platforms in terms of cryptocurrency turnover, beating the Kraken, OKX and Poloniex exchanges.

- 21% of US residents have traded or invested in cryptocurrencies at least once, according to a survey conducted by NBC News. Only 19% of those surveyed expressed their positive attitude towards digital assets, 56% are neutral or cautious position, and 25% view them in a negative way. The agency explained this distrust by the lack of clear legislative regulation of this industry.

- US Senate Banking Committee member Elizabeth Warren compared the digital asset market to the 2008 economic crisis in an interview with NBC. “The whole digital world is like a bubble. What is the basis for its growth? People tell each other that everything will be fine, as it was with the real estate market before it fell,” Warren explained. The senator added that bitcoin will be regulated by the authorities sooner or later. However, she did not specify how the government plans to achieve such control.

- According to analysts at the investment company VanEck, 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.

- A report from analytics firm IntoTheBlock says that long-term investors continue to hoard bitcoin. According to the results of Q1 22, the total amount of coins in the wallets of these market participants reached 12 million BTC, worth about $551.37 billion. “Long-term investors now own a record amount. This indicates an accumulation phase, helps ease selling pressure, and may help reinforce faith in bitcoin as a store of value,” IntoTheBlock said.
Bitcoin is now showing an almost complete cyclical correlation with the S&P500, which recently hit 0.9. At the same time, the cryptocurrency with its inherent volatility rises faster and falls just as faster than the stock market. The company's analysts note that "bitcoin has now recovered most of its quarterly losses, while the S&P 500 and Nasdaq 100 ended the first quarter with returns of -3.4% and -7.65%, respectively."

- Galaxy Digital CEO Mike Novogratz has revised his bitcoin outlook. He 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.

- Cryptocurrency analyst and trader Cheds believes that a breakout of the ascending triangle pattern will take bitcoin to $58,000. “We have $46,000... and an ascending triangle,” Chads writes. - It is most logical to consider it as a bullish sign, since such a triangle is usually a bullish continuation pattern. The measured move will be the height of the triangle, which will bring us 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.


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

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

https://nordfx.com/

 

[Stan NordFX]

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.

continued below...

 

[Stan NordFX]

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

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.


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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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[Stan NordFX]

CryptoNews of the Week

- Bitcoin remains hyper volatile, but its turnover is inferior to other assets, which does not allow us to talk about the high “speculativeness” of the first cryptocurrency. This, according to Financial News, was stated by Tom Lee, co-founder of the analytical firm Fundstrat. According to Lee's calculations, the turnover of bitcoins is 2:1, while that of the US dollar is 96:1, and that of a barrel of oil is 31:1. “Today, with […] penetration rates so low, one would expect bitcoin to be hyper volatile. But as 9 out of 10 households invest in the first cryptocurrency, its price fluctuations will weaken,” the specialist explained.

- David Rubenstein, co-founder of the investment fund Carlyle Group, admitted that he had been skeptical about cryptocurrencies, but his opinion changed over time. He emphasized that he did not buy cryptocurrencies, but “invested in companies that serve the industry.” "The genie is out of the bottle, and I don't think the industry is going to disappear anytime soon," the billionaire said.
He also pointed to the crisis in Ukraine as an additional reason for his current optimism. “If you are in Ukraine or Russia and the country is in a lot of trouble, having some crypto will probably make you feel better as you have something out of government control,” Rubenstein noted.

- The cryptocurrency industry will become the twelfth sector of the S&P 500 index in the next decade. This was stated by investor and star of the television show Shark Tank Kevin O'Leary.
Currently, the S&P 500 benchmark includes 11 sectors of the economy, and most experts advise investing no more than 20% of the portfolio in any of them. According to O'Leary, he adheres to this strategy when investing in cryptocurrencies. The millionaire said that he holds 32 positions in the digital asset sector, and none of them takes more than 5% of the prescribed 20%.
O'Leary stressed that investment diversification is one of the founding principles because "you have no idea what might work." In his opinion, even two successful bets out of ten can recoup unprofitable investments.

- 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.
Bloomberg specialists also noted that they took into account the Coinglass report. According to this company, about $439 million worth of crypto positions were liquidated on April 12. At the same time, more than 88% of closed orders accounted for long positions. Bitcoin futures contracts for $160 million were also closed.

- Philosopher and professor of psychology at the University of Toronto Jordan Peterson spoke at at the Bitcoin-2022 conference in Miami and called the first cryptocurrency revolutionary but causing concern. As a sociologist, Peterson worries about getting money out of the control of the political system. According to him, new ideas can bring unforeseen consequences, and not only positive ones.
“I am not suggesting that you do anything as a result of this warning. I'm just saying that the unbridled enthusiasm is based on the assumption that the new system will only do good. It's unreasonable," Peterson said.

- Group-IB specialists identified 36 fraudulent YouTube streams dedicated to investing in cryptocurrencies in the period from February 16 to February 18. They brought the scammers about $1.7 million during these three days.
The attackers edited videos from old speeches by famous representatives of the crypto community and entrepreneurs. More often than others, the images of Vitalik Buterin, Elon Musk, Michael Saylor, Changpeng Zhao and Cathy Wood were used. On average, the audience of one such stream ranged from 3,000 to 18,000 people. And the fake stream with Buterin gathered more than 165,000 viewers. During the broadcast, users were offered to transfer cryptocurrencies to the specified wallet and allegedly receive them back in double. To receive an “additional bonus”, the attackers offered the investor to provide the seed phrase of their crypto wallet. If the victim agreed, the scammers withdrew all the funds on it.
In total, the deceived viewers made 281 transactions. Ethereum turned out to be the most popular among scammers. Most of the domains involved in the broadcasts appeared through the Russian registrar Reg.ru.

- Geoffrey Halley of Oanda stated 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.

- Crypto trader known as Cheds told their 45,100 YouTube followers that the bears are now in control and any bounce is an opportunity to go short on BTC. Cheds also believes that the next rally is likely to be a bear trap rather than a trend reversal.

- One of the by-products of bitcoin mining is the excess heat from the operation of crypto farms, which Jonathan Yuan took advantage of. He has kids who love swimming 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 approximately 32° C.
At the same time, the Yuan crypto farm thus received a water-cooling system. However, when the inventor pushed his ASIC miners to the limit, the temperature in the pool rose above 43°C, which also did not please his children.
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.

- Well-known writer and investor Robert Kiyosaki fully agrees with the opinion of analysts who believe 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.

- Michael Saylor, CEO of Microstrategy, a company known for investing in bitcoin, and Cathie Wood, CEO of investment firm Arch Invest, contacted at the Bitcoin 2022 conference in Miami. Both participants of the panel discussion still believe in bitcoin and are waiting for its growth, and the current situation in the market does not upset them at all. In their opinion, 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.”
Both panellists believe that regulators are getting better at the flagship cryptocurrency. Treasury Secretary Janet Yellen spoke mostly negatively about bitcoin a year ago, referring to “money laundering, criminals, environmental damage” and so on. However, a lot has changed since then. “Someone whispered in her ear: if you want to lose, and if you want the US to lose, keep saying that. And she changed the record,” Wood shared an "inside info".

- As part of the Bitcoin-2022 conference, Miami Mayor Francis Suarez presented a statue of a “crypto bull”. According to him, the installation symbolizes the transformation of the city into the “world capital of the crypto industry”.
In contrast to its Wall Street's famous Charging Bull sibling, the Miami bull is cybernetically inspired and has the now-famous "laser eyes." The crypto community seems to like the new statue. Morgan Creek Digital co-founder Anthony Pompliano wrote that “the bulls are in control,” while Binance CEO Changpeng Zhao called the installation “pretty cool.”

- 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. Cryptocurrencies lack a fundamental anchor, such as the face value of bonds or the discounted cash flows of stocks,” Morningstar notes.


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

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

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[Stan NordFX]

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.

continued below...

 

[Stan NordFX]

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

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


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