Daily Market Analysis and News From NordFX

[Stan NordFX]

June Results: NordFX's Most Prolific Trader and Partner Earned 24,000 USD Each​

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

The highest profit in June was received by a client from Southeast Asia, account No. 1620XXX, whose profit amounted to 24,665 USD. This solid result was achieved thanks to trades in gold (XAU/USD).

The second place in the rating of the most successful traders of the month was occupied by their compatriot, account No. 1552XXX, who earned 11,405 USD on transactions in the USD/JPY currency pair.

The third place on the June podium went to the representative of East Asia (account No. 1440XXX), whose result of 10,904 USD was also achieved through transactions with gold (XAU/USD).

The situation in NordFX passive investment services is as follows:

- in CopyTrading, the “veteran” KennyFXPRO - Journey of $205 to $5,000 signal is again noticeable, which has shown a profit of 345% over the period since March 2021 with a maximum drawdown of about 67%. At the same time, it should be noted that this drawdown occurred quite a long time ago, in mid-October 2021. Other signals from this provider include KennyFXPRO - Prismo 2K (for 422 days of its life, the profit on it was 157% with a drawdown of just over 45%) and KennyFXPRO - The Cannon Ball. This signal appeared on the CopyTrading showcase 90 days ago, the trading style is non-aggressive, the profit is moderate, about 25%, but the drawdown is less than 7%. Favorite pairs are still the same: AUD/NZD (58%), NZD/CAD (36%) and AUD/CAD (16%).
Quite a few interesting signals have recently appeared among startups. Here are just a few of them: TraderViet9999 (profit 39% / max drawdown 7% / life days15), Ăn ít no lâu dài (34%/11%/49), BSTAR (46%/14%/132), Tịnh Tâm -CN88 (65%/20%/10). JFX TRADING - GOLD SIGNAL (76%/23%/16), Tịnh Tâm- CN88 (64%/20%/10). These signals have quite impressive results. However, it should be understood that they have been achieved thanks to very aggressive trading. Therefore, if someone decides to subscribe, be sure to take the risk factors into account. One of the main factors in this case is a very short lifetime of these signals.

- The TOP-3 in the PAMM service has not changed over the past month. The leader is still the same manager under the nickname KennyFXPRO. In 521 days on his KennyFXPRO-The Multi 3000 EA account, they increased their capital by 118%. Also, in the top three remain: the account TranquilityFX-The Genesis v3, which has shown a profit of 89% in 453 days, and the account NKFX-Ninja 136, which has generated a 76% return since June 11, 2021.
There are two more accounts that we have paid attention to. The first one, COEX.Investment – Treis, has shown a profit of 39% from October 31, 2021. The second one, Ultimate.Duo-Safe Haven, has started relatively recently, at the end of February. It has made a profit of about 29% during this time. The maximum drawdown on all five listed accounts is quite moderate, about 20%.

Among the IB partners, NordFX TOP-3 is as follows:
- the largest commission amount, 24,700 USD, was credited in June to a partner from Southeast Asia, account No. 1371XXX;
- next is a partner from South Asia, account No.1259XXX, who received 4,981 USD;
- and, finally, a partner from South Asia, account No. 1565ХХХ, who received 4,930 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

 

[Stan NordFX]

Forex and Cryptocurrencies Forecast for July 04 - 08, 2022​

EUR/USD: The Dollar Is Gaining Strength Again

The EUR/USD pair moved in a sideways channel of 1.0500-1.0600 for a week and a half. However, it is clear that neither investors nor speculators are interested in such stagnation. But some kind of trigger is needed to break out of it.

The last meeting of the G7 leaders and the NATO summit did not have any particularly loud statements. At both events, a desire was expressed to continue helping Ukraine in its military confrontation with Russia, and the NATO bloc was replenished with two new members, Sweden and Finland. But these results were not enough to somehow influence the quotes of the dollar and the euro.

The trigger for the strengthening of the dollar, which forced the EUR/USD pair to go south on Tuesday, June 28 and break through the lower limit of the channel the next day, was the growth in demand for protective assets amid concerns about the prospects for the world economy. And taking into account the fact that the American currency has recently acted as a protective asset, the scales have tilted in its direction.

Speaking at the annual forum of the European Central Bank in Sintra, Portugal, ECB President Christine Lagarde said that “inflation expectations in the Eurozone are much higher than before”, that “we are unlikely to return to conditions of low inflation soon”, and that the regulator “will go as far as necessary to reduce inflation to the target of 2%”. Christine Lagarde confirmed that the ECB intends to raise its key interest rate by 0.25% at its meeting on July 21 in order to achieve this goal. However, according to market participants, such a modest step is unlikely to have any serious effect. And the next meeting of the Bank will take place only in autumn, on September 08. So, most likely, inflation will continue to grow during this period.

The speech of US Federal Reserve Chairman Jerome Powell, who participated in the ECB forum as a colleague and guest of honor, was quite different in tone from the words of Christine Lagarde. The American assured the audience that the US economy is in a good position to cope with the active tightening of monetary policy, which is being implemented by his department.

The divergence between the ECB's careful monetary policy and the hawkish Fed has always been interpreted by the market in favor of the dollar. The same happened this time as well, and the EUR/USD pair continued its fall.

The European currency was slightly helped by weak macro data from the US in the second half of June 30. The impetus for a temporary rise in the pair was the release of data on GDP, which turned out to be less than expected, falling by 1.6% instead of the expected 1.5%. In addition, statistics showed a slowdown in economic growth rates from 5.5% to 3.5%. Data on basic spending on personal consumption in the United States did not live up to expectations either. Data on applications for unemployment benefits in the United States turned out to be noticeably worse than expected. Thus, the number of initial requests should have been reduced from 233K to 218K. However, their number decreased to only 231 thousand. The situation is similar with repeated requests, which decreased from 1.331K to just 1.328K.

However, all of the above negative factors provided only temporary support to the European currency. Fixing quarterly profit on the dollar did not help it much, and it went on the offensive again on Friday. The publication of data on inflation in the Eurozone, which accelerated from 8.1% to 8.6%, only speeded up the flight of investors to safe assets. As a result, the pair fixed a local bottom at 1.0364 and ended the five-day period at 1.0425.

The votes of experts at the time of writing the review, on the evening of July 01, are divided as follows: 35% side with the bulls, 50% - with the bears, and 15% are neutral. Among the oscillators on D1, 75% are red, 10% are green, and 15% are neutral gray. Trend indicators have 100% on the red side. The nearest resistance is located in the zone 1.0470-1.0500, then the zone 1.0600-1.0615 follows, in case of success the bulls will try to rise to the zone 1.0750-1.0770, the next target is 1.0800. Except for 1.0400, the bears' task number 1 is to break through the support zone 1.0350-1.0364, formed by the lows of May 13 and July 01. If successful, they will move on to storm the 2017 low of 1.0340, below is only 20-year-old support and the cherished goal, 1:1 parity.

This coming week, July 04 is a public holiday in the USA: the country celebrates Independence Day. Statistics on retail sales in the Eurozone will be released on Wednesday, July 06. The publication on the same day of the ISM index of business activity in the US services sector and the minutes of the June meeting of the FOMC (Federal Open Market Committee) are also noteworthy. A similar minute of the ECB meeting and the ADP report on the level of employment in the US private and non-farm sectors and the number of initial applications for unemployment benefits will be published on Thursday, July 07. And another portion of data from the US labor market will arrive on Friday, October 08, including such important indicators as the unemployment rate and the number of new jobs created outside the agricultural sector (NFP).

GBP/USD: Similarities and Differences with EUR/USD

GBP /USD showed similar dynamics to EUR/USD last week. The reasons for the ups and downs of quotes are also similar. Therefore, it makes no sense to list them again. The pair moved clamped in the side channel 1.2165-1.2325 for a week and a half, and then flew down on June 28. A breakdown of support at 1.2100 increased bearish pressure, and it recorded a two-week low at 1.1975. This was followed by a correction to the north, and the pair finished at 1.2095;

Despite the fact that the euro and the pound behaved similarly against the dollar, there are still differences between them. The position of the Eurozone economy is complicated by a heavy dependence on Russian natural energy, the supply of which is limited due to sanctions imposed on Russia after its invasion of Ukraine. The situation is gradually improving: it became known that the United States bypassed Russia in gas supplies to Europe in June, for the first time. However, the final solution of the energy problem is still far away.

Unlike the EU, the UK's dependence on Russian energy is minimal. However, the strengthening of the British currency is hampered by political instability. Prime Minister Boris Johnson already survived a vote of no confidence in June, with several lawmakers from his own Conservative Party voting against him. In addition, after the by-elections, the party lost two seats in the UK Parliament. Problems associated with Brexit also add nervousness. The British pound came under additional pressure after MPs approved a bill allowing ministers to cancel part of the Northern Ireland protocol.

As for the country's economy, according to some experts, inflation in the United Kingdom will continue to grow and may exceed 11% by November.

At the moment, 60% of experts believe that the pair GBP/USD will try to consistently test the support of 1.1975 and 1.1932 in the near future. 40%, on the contrary, are waiting for a breakdown of the resistance at 1.2100 and further to the north. Among the trend indicators on D1, the power ratio is 100:0% in favor of the reds. Among the oscillators, the advantage of the bears is slightly less: 75% indicate a fall, the remaining 25% have turned their eyes to the east. Strong support lies at 1.2000, followed by lows of July 01 at 1.1975 and of June 14 at 1.1932. The bears' medium-term target may be the March 2020 low of 1.1409. In case of growth, the pair will meet resistance in the zones and at the levels of 1.2100, 1.2160-1.2175, 1.2200-1.2235, 1.2300-1.2325, 1.2400-1.2430, 1.2460, then the targets in the area of 1.2500 and 1.2600 follow.

As for the macroeconomic calendar for the UK, we advise you to pay attention to Tuesday, July 05, when the speech of the head of the Bank of England Andrew Bailey is expected. The composite PMI index and the index of business activity in the UK services sector will be published on the same day, and the index of business activity in the construction sector of this country a day later.

continued below...

 

[Stan NordFX]

USD/JPY: Just a Breather or a Change in Trend?

USD/JPY hit a new 24-year high last week once again, climbing to a high of 136.99 on Wednesday June 29. However, the difference from the previous high of June 22 is less than 30 points, and the two-week chart already looks more like a sideways channel than an uptrend. Perhaps the strength of the bulls has dried up and they, at least, need a break.

And perhaps, finally, the long-awaited dream of Japanese importers and housewives will come true, and the yen will go on the offensive, regaining the status of a popular safe-haven currency? It's possible. But not guaranteed. The difference between the super-dove monetary policy of the Central Bank of Japan and the distinctly hawkish monetary policy of the US Central Bank is too great.

Most analysts (50%) still expect the pair to move down at least to the 129.50-131.00 zone. 30% of experts vote for the fact that the pair will once again try to renew the maximum and rise above 137.00, and 20% believe that the pair will take a breather, moving in the side channel 134.50-137.00. For indicators on D1, the picture is very different from the opinion of experts. For oscillators, 65% are colored green (of which 10% are in the overbought zone), the remaining 35% have taken a neutral position. For trend indicators, 65% point north as well, and only 35% point south. The nearest support is located at 134.50-134.75, followed by zones and levels at 134.00, 133.50, 133.00, 132.30, 131.50, 129.70-130.30, 128.60 and 128.00. Apart from overcoming the immediate resistance at 136.00-136.35 and taking the height of 137.00, it is difficult to determine further targets for the bulls. Most often, such round levels as 137.00, 140.00 and 150.00 appear in the forecasts. And if the pair's growth rates remain the same as in the last 3 months, it will be able to reach the 150.00 zone in late August or early September.

No important events, be it the release of macroeconomic statistics or political factors, are expected in Japan this week.

continued below...

 

[Stan NordFX]

CRYPTOCURRENCIES: Will Bitcoin Drop to $1,100? We look at the US Federal Reserve.

The battle for $20,000 continued throughout the second half of June. The BTC/USD pair fell to $17,940, then rose to $21,940. It should be noted that $20,000 is historically the most important level for the main cryptocurrency. Suffice it to recall the catastrophic crash of December 2017, when bitcoin approached this mark, reaching a height of $19,270, and then collapsed by 84%. Many experts expect something similar now, predicting a further fall of another 50-80% for the BTC/USD pair. And Robert Kiyosaki, author of the bestselling book Rich Dad Poor Dad, predicts an even more powerful collapse of bitcoin, by 95%, to $1,100.

In the meantime (Friday evening, July 01), the coin is trading in the $19,440 zone. The total capitalization of the crypto market at this moment is $0.876 trillion ($0.960 trillion a week ago). The Crypto Fear & Greed Index, like a week ago, is in the Extreme Fear zone at around 11 points out of 100 possible.

If you look at the charts, you can see that the bears had a clear advantage over the past week. And, in fairness, we note that bitcoin itself is not really to blame for this. It's all about the strengthening of the dollar, which is growing due to the rise in rates and the tightening of the monetary policy of the US Central Bank. In such a situation, investors prefer to get rid of risky assets by purchasing US currency. Global stock markets are under pressure from sellers, the MSCI World and MSCI EM indices are going down, showing the situation in developed and emerging markets, respectively. Among the developed markets, the main pressure fell on the European sites, but did not bypass he US either: the S&P500, Dow Jones and Nasdaq Composite, with which BTC is in direct correlation, are also moving south.

Additional downward pressure on the quotes of the first cryptocurrency is exerted by mining companies in need of liquidity. According to JPMorgan bank strategist Nikolaos Panigirtzoglou, this situation will continue in Q3 of 2022. According to the expert's calculations, public mining companies account for about 20% of the hash rate. Many of them sold bitcoins to cover operating expenses and service loans. Due to the more limited access to capital, private miners took similar steps as well. “Unloading will continue in Q3, if the profitability of production does not improve. This was already evident in May and June. There is a risk that the process will continue,” the JPMorgan strategist believes.

According to Bloomberg, the cost of mining 1 BTC from $18,000-$20,000 at the beginning of the year dropped to about $15,000 in June due to the introduction of more energy-efficient equipment. However, it is not yet clear whether this will be enough for the stable functioning of the miners.

The recession in the cryptocurrency market will last for about 18 more months, and the industry will see the first signs of recovery after the easing of the Fed’s monetary policy. This was stated by the head and founder of the Galaxy Digital crypto bank Mike Novogratz in an interview with New York Magazine. “I hope we have already seen the worst. I would be more confident about this if I knew what inflation would be like in the next two quarters. [...] I think the Fed will have to abandon the rate hike by the fall, and I believe that will make people calm down and start building again,” said the head of Galaxy Digital.

According to Novogratz, the crisis has changed people's attitudes towards high-risk assets like cryptocurrencies. He noted that the past few months have shown the industry's dependence on leverage, which no one knew about. And it will take time now for the bankruptcy of weak players and the sale of collapsed assets. According to the head of Galaxy Digital, the situation is similar to the global financial crisis of 2008, followed by a wave of consolidation in the investment and banking industries.

Crypto analyst Benjamin Cowen doubts that the forecasts for a high BTC rate for 2023 can come true. In particular, he spoke about the forecast of venture capital investor Tim Draper, according to which the price of bitcoin could grow by more than 1000% from current levels and reach $250,000.

“I used to believe that BTC would be above $100,000 by 2023, but now I am skeptical about this idea. Especially after the Fed's policy has changed so much over the past six months,” Cowen wrote. "I also look at other things, like social media statistics, and I see that the number of people interested in cryptocurrencies is in a downtrend. If it is difficult for people to buy gasoline, it will be even more difficult to buy bitcoin.”

Instead of a huge rally, Cowen predicts an uninteresting BTC market over the next two years: “I think the bear market will end this year, and then the accumulation phase will begin, as in 2015 and 2019. Then there will be slow preparations for the next bitcoin halving, and the Fed may lower interest rates due to the victory over inflation during this period.”

It is clear that many forecasts depend on the models, indicators and other analysis tools used. For example, we wrote a week ago how the creator of The Daily Gwei, Anthony Sassano, and the co-founder of Ethereum, Vitalik Buterin, criticized the Stock-to-Flow (S2F) model, on the basis of which a popular analyst aka PlanB issued his forecasts. Following criticism, PlanB has unveiled a chart of not one, but five different forecasting models. Indeed, S2F showed an overly optimistic view. The most accurate picture was given by estimates based on the complexity and costs of mining the first cryptocurrency.

Another analyst named Dave the Wave uses a logarithmic growth curve (LGC) model and believes that BTC can grow by 1100% within 4 years and reach $260,000. In the short term, Dave the Wave predicts the possibility of bitcoin rising to $25,000.

According to the cryptanalytic platform CryptoQuant, most cyclical indicators (Bitcoin Puell Multiple, MVRV, SOPR and the MPI BTC Miner Position Index) indicate that bitcoin is close to the bottom. The readings of these indicators are based on a historical pattern that has preceded an uptrend several times. Indicators also suggest that bitcoin is currently undervalued, signaling an imminent rally. A significant amount of unrealized losses confirms this forecast.

Anthony Scaramucci, the founder of SkyBridge Capital investment fund, also said that the first cryptocurrency is “technically oversold”. He made this conclusion by analyzing the current BTC price in the context of an exponential growth in wallet activity and an increase in the number of use cases. At the same time, the hedge fund manager advised investors to evaluate bitcoin in retrospect. With this approach, the asset will turn out to be "very cheap due to excess leverage, which is worth taking advantage of."

We talked at the end of the previous review about another “forecasting model” presented by the President of El Salvador, Nayib Bukele. “My advice is to stop looking at charts and enjoy your life. If you have invested in BTC, your investment is safe, its value will rise immeasurably after the end of the bear market. The main thing is patience,” the head of state wrote.

And now Yifan He, CEO of Chinese blockchain company Red Date Technology, has responded to this advice. He compared cryptocurrencies to financial pyramids and stated that the authorities of El Salvador and the Central African Republic (CAR), who decided to legalize bitcoin, are in serious need of basic education in finance. According to He, the leaders of these states put entire countries at risk, unless their original intention was to fraud their own citizens. It is not yet known whether Naib Bukele was offended by such words. We will follow the news.


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

 

[Stan NordFX]

NordFX Super Lottery: First 54 Prizes Worth $20,000 Drawn​

The first draw of the Super Lottery by brokerage NordFX took place on July 4, 2022. It was online, and anyone could follow the prize draw on the Internet. The video of the draw has been posted on the company's official YouTube channel.

Draw No. 1 included tickets credited to NordFX clients from March 01 to June 30, 2022. There were 54 prizes for a total of $20,000.

According to the rules, the prize funds can be used by the lottery winner in trading or withdrawn from the account at any time by any of the available methods and without any restrictions.

The next draws will take place on October 06, 2022 (tickets accrued from March 01 to September 30, 2022, prize fund $20,000), and on January 04, 2023 (tickets accrued from March 01 to December 31, 2022, the prize fund $60,000).

You can enter the lottery and get a chance to win one or even several cash prizes, including two super prizes of $10,000 each, at any time. It is enough to have a Pro account at NordFX (and for those who do not have it - register and open a new one), top it up with $200 and... just trade.

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


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

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

 

[Red_Lesta]

Robert Kiyosaki has previously predicted $11k. I'm sure the $1,100 prediction was either a typo or some form of publicity stunt.

 

[Stan NordFX]

CryptoNews of the Week

- The record decline in the price of bitcoin in June practically took the rest of the “market tourists” out of the game, leaving only hodlers “at the front”. These are the conclusions made by Glassnode analysts. In the context of monthly dynamics, the situation was worse only in 2011. The number of daily active addresses has dropped from over 1 million in November to the current 870,000.
The outflow of bitcoin from centralized exchanges has emptied reserves to levels last seen in July 2018. Monthly rates reached 150,000 BTC (5-6% of the total) in June. The decline in exchange reserves is complemented by the indicator of “illiquid supply”. In June, it rose to a record 223,000 BTC since July 2017.
Aggressive accumulation of coins is observed among so-called shrimps (balances less than 1 BTC) and whales (over 10,000 BTC). The monthly coin accumulation rate was the first to reach 60,460 BTC (0.32% of the market supply), which is higher than the previous record of 52,100 BTC in December 2017. As for whales, they withdrew 8.99 million BTC from exchanges. In June, the rate reached 140,000 BTC, the second result in five years.

- Deutsche Bank strategists believe that the arguments for bitcoin as “digital gold” have fallen apart. Cryptocurrency has not become a safe haven amid falling stock markets, physical gold “has behaved better” in this regard.
In their opinion, bitcoin is more like diamonds, a “high-market asset” that relies mainly on marketing. They recalled that the largest player in the market, De Beers, managed to change consumer attitudes towards precious stones with an advertising campaign in the 1950s. “By selling an idea rather than a product, they have created a solid foundation for the $72 billion a year industry that has dominated for the past 80 years. What is true for diamonds is true for many goods and services, including bitcoin,” the experts said.
Deutsche Bank specialists believe that the price of bitcoin can recover to the level of $28,000 by the end of 2022. This rise will be associated with a rally in the US stock market as cryptocurrencies correlate increasingly with the Nasdaq 100 and S&P 500 indices. These benchmarks will recover to their January levels by the end of the year, holding bitcoin in their wake.

- Former hedge fund manager Cramer & Co and host of CNBC's Mad Money show Jim Cramer believes the US Fed has won a "remarkable victory" in the fight against cryptocurrencies. “There is a front in the war against inflation with the Fed's outstanding victory: it's a battle against financial speculation. [...] The work on destroying cryptocurrencies is almost complete, but they don't seem to know about it yet,” he said.
According to Cramer, digital assets do not protect investors from anything, and the Fed needs to continue to fight inflation, especially in the issue of wages.

- The financier Michael Burry, who predicted the 2007 mortgage crisis, has admitted that the current market situation is just the middle of a bear cycle for bitcoin. The investor, who became the prototype of the hero of the movie "The Big Short", believes that the first cryptocurrency can continue to fall. «Adjusted for inflation, 2022 first half S&P 500 down 25-26%, and Nasdaq down 34-35%, Bitcoin down 64-65%. That was multiple compression. Next up, earnings compression. So, maybe halfway there,” wrote Burry.
Recall that, according to Arcane Research researchers, the potential for a decrease in the price of bitcoin remains until the level of $10,350.

- The worst of the bear market may be behind us as the strong players in the crypto industry “rescue” the weak ones to contain the “infection”. This was stated by JPMorgan strategist Nikolaos Panigirtzoglou. The specialist could have in mind the interest of the FTX cryptocurrency exchange in buying the BlockFi landing platform. The media also mentioned the online broker Robinhood as a target for the takeover. Previously, the FTX exchange supported the cryptocurrency broker Voyager Digital. The expert mentioned the high rates of venture financing in May-June as an additional factor for optimism.
Panigirtzoglou also added that "the echoes of the deleveraging process will continue for some time yet," citing the default of hedge fund Three Arrows Capital.

- Crypto trader with the nickname Rekt Capital believes that the market will face an exhaustion of sellers, and long-term investors will have the opportunity to purchase BTC in a price range that offers the maximum reward. “Historically, the 200-week moving average has been considered a bottom indicator for BTC. Things may be a little different in the current cycle. Instead of bottoming out at the SMA200, bitcoin could form a macro range below it. In fact, anything below will represent a peak buying opportunity,” wrote Rekt Capital.
The trader noted that while bitcoin remains in a strong downtrend, the prerequisites for a new bull cycle will eventually open up: “Bitcoin may still be in the acceleration phase downtrend, and it will precede the stage of multi-month consolidation, followed by the stage of a new upward macro trend.”

- Former stockbroker Jordan Belfort believes that investing in bitcoin can protect investors' funds from inflation in the long run. “If you look beyond the 24-month horizon, you can definitely make money if you're lucky. If you take a three- or five-year period, I will be shocked if you do not make money, because the basic principles of bitcoin are unshakable,” he said, explaining that the supply of the first cryptocurrency is limited to 21 million digital coins, and inflation in the world continues to grow.
Belfort believes that bitcoin is now behaving like a tech stock, correlating with the Nasdaq index. However, investments by institutional investors in the first cryptocurrency cannot yet be called large-scale, since bitcoin is still in its infancy. For an extensive influx of institutional money into the crypto-currency sector, well-designed regulation of crypto-assets is necessary.
Recall that earlier Jordan Belfort was convicted of fraud related to the securities market. His memoir inspired director Martin Scorsese to create the famous film The Wolf of Wall Street.

- Charles Erith, CEO of ByteTree investment company, believes that bitcoin and gold will be important components of investment portfolios for many years to come. Not because they are guaranteed to increase in price, but because they work as insurance against mistakes in an era of inflation. However, according to the financier, a lot depends on the policy of the US Federal Reserve and other central banks.

- The cost of bitcoin will fall under the pressure of the American factor in the coming months. The US economy is entering a recession, so capital will leave risky assets. This is the opinion of Timothy Peterson, investment manager from Cane Island Alternative Advisors. According to his calculations, the probability of a recession in the US has risen to 70% and the BTC price may collapse by 20% or even 40% by the end of summer.
The expert recalled that he had already predicted the continuation of the negative trend in the crypto market, and in the end he was right. The quarter turned out to be the worst for bitcoin in the last ten years.


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

 

[Stan NordFX]

Forex and Cryptocurrencies Forecast for July 11 - 15, 2022​

EUR/USD: One Step to 1.0000

We have repeatedly written about the dollar's desire to achieve parity with the euro 1:1. But we did not expect that this could happen so quickly: the EUR/USD pair found a local bottom at the level of 1.0071 on Friday, July 08. Only 71 points remained until 1.0000. The last time it was so low was in December 2002.

The week's high was recorded at 1.0462. Thus, the US currency squeezed out the European currency by almost 400 points from July 04 to July 8. And there are two reasons for this.

The first is the general strengthening of the dollar, whose DXY index has renewed 20-year highs and reached a height of 107.77 on July 08. As before, the main reason for such dynamics lies in the tightening of the monetary policy (QT) of the US Central Bank. The minutes of the June meeting of the FOMC (Federal Open Market Committee) published on Wednesday, July 06 confirmed once again the regulator's desire to curb inflation at any cost. The main tool here should be a sharp increase in the refinancing rate for federal funds. Recall that the rate was raised immediately by 0.75% in June, for the first time since 1994. As follows from the FOMC minutes, the members of the Committee believe that the rate will be increased by another 50-75 basis points at the next meeting on July 27.

Recall that the head of the Fed, Jerome Powell, who participated in the ECB forum in the Portuguese city of Sintra, assured the audience that the US economy is well positioned to cope with the active tightening of monetary policy, which is being implemented by his department.

It should be noted here that there is a rather rare situation in the markets when US stock indices also grow along with the growth of the dollar. Thus, the S&P500 grew by 7.5% (from 3635.60 to 3910.60) since June 17, and the Dow Jones - by 6.1% (29646.60 to 31463.00). The reason for this, most likely, is that investors invest part of the dollars received from the sale of the euro, other currencies, as well as risky assets of other countries, in shares of American companies. And this is despite the fact that Jerome Powell made it clear at the press conference in Sintra that a recession in the US economy is inevitable, and the Federal Reserve Bank of Atlanta announced that US GDP could decline by 2.1% in the current quarter. But, apparently, the situation in other countries is even worse, so investors have very limited choice.

The second factor putting pressure on the EUR/USD pair is the problems of the European economy related to the sanctions imposed on Russia because of its armed invasion of Ukraine, which threaten the EU with a protracted energy crisis.

ECB President Christine Lagarde said a week ago that “inflation expectations in the Eurozone are much higher than before”, that “we are unlikely to return to conditions of low inflation soon”, and that the regulator “will go as far as necessary to reduce inflation to the target of 2%”. But less than a few days later, Bundesbank chief Joachim Nagel urged the ECB to be extremely cautious in terms of tightening monetary policy, as raising interest rates would push the eurozone's weakest economies to the brink of bankruptcy. As a result, the market decided that the regulator would raise the key rate very slowly and responded to the words of Joachim Nagel with an even more active sale of the euro.

It should be noted that the release of macro statistics has recently become just an excuse for a correction or, conversely, for a return to the general bearish trend: in total, the pair has lost about 2,200 points since January 2021, and the fall has been more than 5,800 points since July 2008. After a small correction, the last chord sounded at the level of 1.0177 last week. At the time of writing the review, on the evening of July 08, the voices of experts are divided as follows: 65% of experts expect the resumption of movement to the south, 15% side with the bulls and 20% cannot decide on the forecast. The indicator readings on D1 give a completely unambiguous signal: all 100% of oscillators and trend indicators are colored red. The only thing worth noting is that 15% of the oscillators are in the oversold zone.

With the exception of support at 1.0160 and last week's low at 1.0071, bears' task No.1 is to celebrate the victory by hitting 1.0000. With a certain degree of probability, due to inertia, the pair may fall even lower, to a strong support/resistance zone of 200, 0.9900-0.9930. In this case, the level of 1.0000 will have to be attacked not by bears, but by bulls. Although this may not happen. Suffice it to recall 2017, when, having fallen to 1.0340, the EUR/USD pair reversed and soared to 1.2555. The immediate target of the bulls is a return to the zone 1.0350-1.0450, then there are zones 1.0450-1.0600 and 1.0625-1.0760. If successful, the bulls will try to rise to the 1.0750-1.0770 zone, the next target is 1.0800.

As for the economic calendar for the coming week, Wednesday 13 July can be highlighted, when data from the consumer markets in Germany and the US will arrive. Another portion of macro statistics can be expected on Friday, July 15, when retail sales and the US University of Michigan Consumer Confidence Index become known.

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[Stan NordFX]

GBP/USD: Battle for 1.2000

Unlike the collapsed euro, the GBP/USD managed to cling to the 1.2000 level. Having started the week at 1.2095, it first rose to 1.2164, then fell to 1.1875, but eventually managed to complete the five-day period at 1.2030. This is despite the political crisis in the UK and the statement of a number of ministers, including Prime Minister Boris Johnson himself, about their resignation.

Other factors, including economic ones, logically, should also put downward pressure on the pound. Problems related to Brexit are among them. Recall that there is a bill in the country's Parliament that allows to unilaterally change the customs procedures between Britain and Northern Ireland, which had been agreed as part of the deal to exit the EU. In response, the outraged foreign ministers of Germany and Ireland have already accused the United Kingdom of violating international agreements and predicted the severing of most trade ties between the countries.

The highest inflation in 40 years is also depressing. And although the UK is much less dependent on Russian energy supplies than the EU, this does not exclude the possibility that inflation in the country by November could exceed 11%, pushing the economy into a deep recession.

However, this threat may have served as support for the pound, as it pushes the Bank of England (BOE) to tighten monetary policy more quickly. Thus, the hawkish statements of the leadership of the British regulator, made on Thursday, July 07, stopped the fall of the GBP/USD pair and even managed to reverse it to the north.

First, a member of the Monetary Policy Committee (MPC) Katherine Mann said that the uncertainty about the inflationary process strengthens the arguments in favor of an outstripping increase in interest rates. And soon the Chief Economist of the Bank of England, Hugh Pill, announced that, if necessary, he was ready to accept a faster pace of tightening the policy of the Central Bank.

At the moment, 60% of experts believe that the GBP/USD pair will continue to decline in the near future, 15%, on the contrary, expect a rebound upwards, and 25% have taken a neutral position.

The readings of the indicators on D1 are as follows. Among the trend indicators on D1, the ratio of forces is 85:15% in favor of the reds. Among the oscillators, the advantage of the bears is slightly less: 75% indicate a fall, the remaining 25% have turned their eyes to the north. The nearest support is at 1.2000, followed by the 1.1875-1.1930 zone. The mid-term target for the bears could be the March 2020 low of 1.1409. In case of growth, the pair will meet resistance in the zones and at the levels of 1.2100, 1.2160-1.2175, 1.2200-1.2235, 1.2300-1.2325, 1.2400-1.2430, 1.2460, then the targets in the area of 1.2500 and 1.2600 follow.

As for the macroeconomic calendar for the UK, we advise you to pay attention to Tuesday, July 12, when the speech of the head of the Bank of England Andrew Bailey is expected. Data on manufacturing production and GDP of the UK will be published the next day, Wednesday, on July 13.

USD/JPY: The Calm Before the Storm?

USD/JPY did not renew its 24-year high for the first time in five weeks. As we predicted, it took a breather, spent five days in the trading range 134.77-136.55 and ended it at 136.06.

Recall that the bulls failed to take the height of 137.00 on June 29, stopping just one step away from it: at the level of 136.99. Will they go on a new assault? The number of supporters of such a scenario among the surveyed experts turned out to be... 5%. 35% are waiting for the side trend to continue. The majority of analysts (60%) are still counting on a decisive downward movement of the pair: what if, finally, the long-awaited dream of Japanese importers and housewives finally comes true, and the yen goes on the offensive, regaining the status of a sought-after safe-haven currency?

For indicators on D1, the picture is very different from the opinion of experts. For oscillators, 65% are green, 10% are red, and the remaining 25% are neutral. For trend indicators, 100% point north.

The nearest support is at 135.50, the next one is at 134.75, followed by zones and levels at 134.00, 133.50, 133.00, 132.30, 131.50, 129.70-130.30, 128.60 and 128.00. Apart from overcoming the immediate resistance at 136.35 and taking the height of 137.00, it is difficult to determine further targets for the bulls. Most often, such round levels as 137.00, 140.00 and 150.00 appear in the forecasts. And if the pair's growth rates remain the same as in the last 3 months, it will be able to reach the 150.00 zone in late August or early September.

No important events, be it the release of macroeconomic statistics or political factors, are expected in Japan this week. The only thing to note is the speech by the head of the Bank of Japan, Haruhiko Kuroda, on Monday, July 11. However, one should not expect any sensational statements from him.

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[Stan NordFX]

CRYPTOCURRENCIES: Run or Wait?

Fight for $20,000 does not subside for more than three weeks. At times, it seemed that a catastrophe was imminent, and the BTC/USD pair would fly further into the abyss in a moment. Moreover, some analysts predicted that it would lose another 50-80% of the current value. And Robert Kiyosaki, author of the bestselling book Rich Dad Poor Dad, predicted an even more powerful collapse, by 95%, to $1,100. But the bulls have managed to hold this front line so far.

We already wrote that $20,000 is historically the most important level for the main cryptocurrency. Suffice it to recall the disaster of December 2017, when bitcoin approached this mark, reaching a height of $19,270, and then collapsed by 84%. True, the attack on $20,000 came from the south then, and it is from the north now.

Some crypto enthusiasts are still trying to insist on the independence of the digital asset market. They believe that the reason for the large-scale sale of coins and the collapse of the market three times was the collapse of a number of projects. But, in our opinion, the causal relationship is violated in this statement. In fact, global risk aversion is at the heart of all the problems. Frightened by the expectation of a global recession and a sharp tightening of the US Federal Reserve's monetary policy, they are actively getting rid of all risky assets. Global stock markets are under pressure from sellers, which is clearly seen on the charts of such stock indices as S&P500, Dow Jones and Nasdaq Composite, with which BTC is in direct correlation. Where they go, bitcoin goes, and there has long been no talk of any independence of it. It was these global problems of the world economy that led to the collapse of a number of important crypto projects, which, in turn, only increased panic among digital asset holders.

Analyzing the situation, Former hedge fund manager Cramer & Co and host of CNBC's Mad Money show Jim Cramer announced the US Fed has won a "remarkable victory" in the fight against cryptocurrencies. “There is a front in the war against inflation with the Fed's outstanding victory: it's a battle against financial speculation. [...] The work on destroying cryptocurrencies is almost complete, but they don't seem to know about it yet,” he said.

According to Glassnode, bitcoin's record price decline in June almost took the rest of the “market tourists” out of the game, leaving only hodlers “at the front”. In the context of monthly dynamics, the situation was worse only in 2011. The number of daily active addresses has dropped from over 1 million in November to the current 870,000. The growth rate of the number of participants decreased to the anti-records of 2018-19. and do not currently exceed 7,000 new users per day.

The largest outflow is recorded among institutional investors (companies with investments from $1 million), public miners (expanding production on credit), as well as speculators and casual players. Institutions withdrew a record $188 million from crypto funds in June, and the volume of “illiquid supply” rose to the highest level since July 2017 at 223,000 BTC.

Thanks to a correction in the US stock market, bitcoin managed to rise above $20,000 last week. At the time of writing this review (Friday evening, July 08), the coin is trading in the $21,800 zone. The total capitalization of the crypto market is $0.966 trillion ($0.876 trillion a week ago). The Crypto Fear & Greed Index has slightly improved over the week, rising from 11 to 20 points, but is still in the Extreme Fear zone.

What is the future of the main cryptocurrency? According to Timothy Peterson, investment manager at Cane Island Alternative Advisors, the price of bitcoin will continue to fall in the coming months under the pressure of the American factor. According to the expert’s calculations, the probability of a recession in the United States has increased to 70%, respectively, capital will continue to leave risky assets, and the BTC price may collapse by 20% or even 40% by the end of summer. Recall that, according to Arcane Research researchers, the potential for a decrease in the price of bitcoin remains until the level of $10,350.

The financier Michael Burry, who predicted the 2007 mortgage crisis, also admits that the current market situation is only the middle of a bearish cycle. This investor, who became the prototype of the hero of the movie "The Big Short", believes that the first cryptocurrency can continue to fall. «Adjusted for inflation, 2022 first half S&P500 down 25-26%, and Nasdaq down 34-35%, Bitcoin down 64-65%. That was multiple compression. Next up, earnings compression. So, maybe halfway there,” wrote Burry.

Deutsche Bank specialists believe that the price of bitcoin may rise to the level of $28,000 only by the end of 2022. And they also attribute this growth with the growth of the US stock market. In their opinion, the Nasdaq-100 and S&P500 indices will be able to recover to January levels by the end of the year and pull bitcoin with them.

The forecast of Nikolaos Panigirtsoglou, a representative of another bank, JPMorgan strategist, looks quite accurate. He admits that the worst of the bear market may be over now, as the strong players in the crypto industry “rescue” the weak ones to contain the “infection”. The specialist could have in mind the interest of the FTX cryptocurrency exchange in buying the BlockFi landing platform. The media also mentioned the online broker Robinhood as a target for the takeover. Previously, the FTX exchange supported the cryptocurrency broker Voyager Digital. Panigirtzoglou also added that "the echoes of the deleveraging process will continue for some time yet," citing the default of hedge fund Three Arrows Capital.

Crypto trader Rekt Capital is waiting for the market to run out of sellers at some point, and long-term investors will be able to buy BTC in a price range that offers the maximum reward. “Historically, the 200-week moving average has been considered a bottom indicator for BTC. Things may be a little different in the current cycle. Instead of bottoming out at the SMA200, bitcoin could form a macro range below it. In fact, anything below will represent a peak buying opportunity,” wrote Rekt Capital.

The trader noted that while bitcoin remains in a strong downtrend, the prerequisites for a new bull cycle will eventually open up: “Bitcoin may still be in the acceleration phase downtrend, and it will precede the stage of multi-month consolidation, followed by the stage of a new upward macro trend.”

All of the above forecasts indicate that it will take at least several months to wait for a new bullish rally. But former stockbroker Jordan Belfort advises to be patient not for months, but for years. “If you look beyond the 24-month horizon, you can definitely make money if you're lucky. If you take a three- or five-year period, I will be shocked if you do not make money, because the basic principles of bitcoin are unshakable,” he said, explaining that the supply of the first cryptocurrency is limited to 21 million digital coins, and inflation in the world continues to grow.

Recall that earlier Jordan Belfort was convicted of fraud related to the securities market. His memoir inspired director Martin Scorsese to create the famous film The Wolf of Wall Street. But if earlier this broker violated the law, now he actively advocates for a clear regulation of crypto assets.

Charlie Erith, CEO of investment firm ByteTree, shared a view similar to Belfort’s. Like The Wolf of Wall Street, he looked far into the future, identifying bitcoin and gold as important components of long-term investment portfolios. Not because they are guaranteed to increase in price, but because they work as insurance against mistakes in an era of inflation. However, according to the financier, much will depend on the policy of the US Federal Reserve and other central banks.


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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