2023 Market Forecast by Solid ECN

[SOLID ECN LLC]

Bitcoin

Cryptocurrencies at the start of the week are trying to make up for declines from the weekend, when Bitcoin retreated below $23,000 on a wave of disappointing for bulls PCE US inflation data. But today Wall Street indices rise again.

Despite media reports of a possible global ban on cryptocurrencies being analyzed by the International Monetary Fund and the Financial Stability Board, former World Bank president and IMF chief Georgieva indicated that rather than resorting to a global ban, regulators will work to create an appropriate regulatory framework, taking into account the popularity of cryptocurrencies in emerging economies. In the wake of a softening extreme regulatory spectrum and a rebound on exchange floors, with Bitcoin trading near $23,800, other cryptocurrencies are also trying to rebound.

List of the most gaining cryptocurrencies. Leading the way are the intensely oversold NEO, DYDX and Maker on Friday.

Cryptocurrency-based investment products saw outflows last week, after investors moved funds into funds betting on Bitcoin declines.
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• Positive U.S. economic data and the prospect of more Fed rate hikes dampened risk demand, weighing on cryptocurrencies. Funds betting on BTC declines saw inflows totaling $10 million in the week ended February 24, according to CoinShares, compared to an outflow of $12 million from funds betting on a rise in the BTC price (the third weekly decline in a row). Positive fund inflows were registered by CoinShares for Polygon, Solana and Cardano with slightly negative ones for Ethereum.​

The CoinShares report highlighted the most important short-term risks for the industry are the controversy over regulations planned for implementation in 2023, the position of the SEC - whose head Gary Gensler says that of all cryptocurrencies, only Bitcoin is a 'digital commodity' and may not fall under its jurisdiction, and investor sensitivity to macroeconomic data. , which have recently disappointed bulls by casting doubt on the disinflationary trend.

itcoin, M30 interval. The major cryptocurrency has broken above the SMA200 average and is struggling for a sustained breakout above the 38.2 Fibonacci retracement at $23,800, which could reopen the way to $25,000.​

 

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EURUSD​

EUR appreciated strongly against USD during the European session, however bullish momentum lost its steam in the evening as markets digested fresh comments from ECB's Vujcic.​

• Markets are right to price in 50 bps for the March meeting.​
• Rates are about to enter restrictive territory.​
• Labor markets are likely to remain strong.​
• We must persevere as long as core inflation remains high.​
• We must consider both headline and core inflation​
• Headline inflation is set to fall.​
• The role of the ECB is not to determine where the terminal rate should be.​

The market is pricing in a 44% chance of 75 bps at the ECB March meeting.

EURUSD retreated sharply from session high at 1.0620, erasing a large chunk of today's gains. Nevertheless as long as the pair sits above local support at 1.0580 another upward move may be launched.​

 

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USDCHF Rebounds from the Resistance​

USDCHF pair bounced downwards clearly after testing the bullish channel’s resistance that appears on the chart, to approach the key support 0.9316, noticing that stochastic got rid of its negative momentum to show oversold signals now, while the EMA50 provides positive support to the price.

Therefore, we believe that the chances valid to resume the correctional bullish trend, which targets 0.9475 as a next station, reminding you that the continuation of the bullish wave requires holding above 0.9316.​

 

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GBPUSD - A fall is possible.​

If the assumption is correct, the GBPUSD pair will fall to the area of 1.1400 – 1.1155. In this scenario, critical stop loss level is 1.2437.

 

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Gold​

During today's session gold price bounced off recent lows above the $1,800 an ounce mark, a level not seen since December 2022. Upward move gained steam after publication of latest Conference Board consumer confidence figures. Price is currently approaching crucial support at $1830, which is marked with previous price reactions, upper limit of local 1:1 structure and 38.2% Fibonacci retracement of the upward wave started in March 2020. Should break lower occur, upward move may accelerate towards the key resistance zone between $1868 - 1875 an ounce. On the other hand, if sellers manage to halt declines around $1830 level, another downward impulse may be launched towards psychological support at $1800.

 

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AUDCAD​

The AUDCAD pair ended the correctional bearish rebound by testing the key support 0.9105, to form solid obstacle against the negative trades, noticing the activation of the bullish track by reaching 0.9200.

Note that the frequent consolidation above the EMA50 and stochastic attempt to provide the positive momentum allow us to keep the bullish overview, to expect targeting 0.9240 followed by attempting to press on the initial barrier at 0.9310 in order to find a way to resume the bullish trades.​

 

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USDCAD - Growth is possible

If the assumption is correct, the USDCAD pair will grow to the area of 1.3850 – 1.3977. In this scenario, critical stop loss level is 1.3440.

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USDCHF - Growth is possible.

If the assumption is correct, the USDCHF pair will grow to the area of 0.9600 – 0.9819. In this scenario, critical stop loss level is 0.9332.

 

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CHN Comp​

• US indices finished the final trading session of February lower. S&P 500 dropped 0.30%, Dow Jones moved 0.71% and Nasdaq moved 0.10% lower. Small-cap Russell 2000 bucked the trend and finished 0.04% higher​
• Indices from Asia-Pacific traded mostly higher today. Nikkei added 0.3%, Nifty 50 gained 0.6%, S&P/ASX 200 dropped 0.1%​
• Indices from China traded higher on the back of strong PMIs with Hang Seng trading 4% higher on the day​
• DAX futures point to a higher opening of the European cash session today​
• Bloomberg reports that amount of Russian diesel-type fuel stored in floating storage reached 1.9 million barrels and is the highest since October 2022 as the country struggles to find buyers for its oil derivative products after Western sanctions​
• Official Chinese manufacturing PMI jumped from 50.1 to 52.6 in February (exp. 50.5) and reached the highest level since April 2012. Services gauge moved from 54.4 to 56.3 (exp. 55.0)​
• Australian GDP grew by 0.5% QoQ in Q4 2022 (exp. 0.7% QoQ)​
• Australian CPI inflation dropped from 8.4 to 7.4% YoY in January (exp. 8.1% YoY)​
• Australian final manufacturing PMI for February came in at 50.5 and was revised higher from 50.1 signaled in flash reading​
• Japanese final manufacturing PMI for February came in at 47.7 and was revised slightly higher from 47.4 in flash reading​
• API report pointed to a 6.2 million barrel build in US oil inventories (exp. +0.8 mb)​
• Cryptocurrencies trade higher amid overall improvement in risk moods. Bitcoin gains 2.5%, Ethereum jumps 2.6% and Dogecoin trades 1.7% higher​
• Oil is trading 1% higher while US natural gas prices pull back 1%​
• Precious metals trade higher as USD underperforms - gold adds 0.5% while silver and platinum trade 1.3% higher​
• AUD and NZD are the best performing major currencies while JPY and USD lag the most​

Chinese CHNComp is rallying today following the release of strong official PMIs for February. Index bounced off the support zone ranging between 6,600 pts and 200-session moving average is now trading over 4% higher on the day.​

 

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XRPUSD - Pending decision on SEC lawsuit

This week, the XRPUSD pair resumed growth after the negative dynamics last Friday, which developed against the backdrop of the release of January data on the price index of personal consumption expenditures in the United States: the figure rose from 5.3% to 5.4% YoY. The increase in value reinforced the fears of experts in the continuation of the tightening cycle of the regulator's monetary policy, which supported the dollar and put pressure on alternative assets. On the background of these data, the price dropped to the area of 0.3655 but now it has returned to the middle line of Bollinger bands around 0.3800.

The situation on the market remains uncertain as investors await the final decision on the suit of the US Securities and Exchange Commission (SEC) against Ripple, which should follow soon. The agency insists that the XRP coin, like other cryptocurrencies, except for BTC, is an unregistered security. Corporation lawyers reject the accusations, stating the imperfection of the current definition of the concept of "security" and referring to the statements of the former head of the SEC, William Hinman, who claimed that the ETH token, similar to XRP, is not one. Experts believe that Ripple has a high chance of winning the process. They note that the SEC had previously initiated a similar lawsuit against blockchain platform LBRY, accusing it offering its own LBC tokens but the court ruled that LBC could only be considered a security if there was an initial coin offering (ICO). If Ripple convinces the court that there was no official initial offering, the decision could be favorable for the company, and then leading exchanges such as Coinbase and Binance will re-list XRP, and its price will rise, leveling the negative effect of American monetary policy.

Now, the trading instrument is close to the middle line of Bollinger bands 0.3800, consolidation above which will give the prospect of resuming growth to 0.4150 (Murrey level [+1/8]) and 0.4330 (Fibonacci correction 23.6%). The key “bearish” level is 0.3662 (Murrey level [7/8]), a breakdown of which will provide a decline to 0.3418, 0.3662 (Murrey level [6/8]).

Resistance levels: 0.38, 0.415, 0.433 | Support levels: 0.3662, 0.3418​

 

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NZDUSD

The NZDUSD pair rallied upwards to breach the bearish channel’s resistance and head towards testing the most important resistance at 0.6290, and we prefer to stay aside until the price confirms its situation according to this level, as continuing the rise and breaching it will push the price to achieve additional gains that start by visiting 0.6385 areas, while consolidating below it will press on the price to resume the correctional bearish wave that its targets begin by testing 0.6140.

The expected trading range for today is between 0.6180 support and 0.6280 resistance.​